Amazon (AMZN) is one of the best online retailers and it will continue its success and growth into the second half of 2016. One out of every three product searches online is done through Amazon.com and nearly half of online sales are filtered through Amazon.com.

Source: Statista

The company's drone usage and video streaming initiatives should serve as stable growth drivers. The market is pleased with Amazon’s initiatives, as the stock's value appreciated.

Is it the Right Time to Invest in Amazon?

Amazon did not start the year off at its peak. It lost nearly $120 a share, trending at around $570. As a result of a dip in share price, it could be a good time for investors to start buying Amazon stock.

Currently, Amazon is doing everything it can to have a better year than 2015. The annual number of worldwide active Amazon customer accounts have increased every year.

Source: Statista

Here are some facts leading to this positive growth of Amazon:

In 2015, Amazon experienced four consecutive quarters with high revenue that grew each period. The third-quarter revenue increased by 23% over the year and came out to be $23.4 billion. This growth is expected to continue into 2016. As revenue grows, the stock price will increase and shareholders will benefit.

Amazon's goal is that AMZN will trade at $800 per share. The stock has a beta of 1.46, meaning that there is more volatility and risk involved with trading.

Amazon's Vice President Paul Misener promoted the Prime Air Service to the media. Amazon is developing different types of drones that will be able to deliver merchandise within 30 minutes of a customer's order from Amazon.com given that the package meets certain qualifications.

Amazon currently offers its video streaming service along with their Prime membership. Amazon could now gain a large portion of the video streaming market share.
In addition, Amazon holds its second Prime Day this year. This event offers lots of special deals exclusively to its Prime members. The company decided to make this event an annual thing because it has always been a big success. Consumers ordered 34.4 million items during this event. Amazon saw the largest increase of Prime members in history during this event.
Currently, Amazon has 63 million Prime members in the United States, up from 44 million a year ago. For the first time, Prime members outnumber the company’s non-Prime customers in its home market. Prime members are very important to the e-commerce because they spend more money on the platform than regular customers; averaging $1,200 a year on Amazon whereas non-members spend just $500.

Conclusion

Amazon hopes drone development implementation, improvements to their video streaming service and the increase of its Prime members can place them ahead of competitors. Amazon remains an attractive investment opportunity going forward. Amazon is bringing in additional new features to its existing brands which should allow the company to improve its market share going forward.

My buy recommendation for AMZN is in line with the favorable 1-year algorithmic forecast from I Know First. The +21.25 score says AMZN is undervalued right now and is likely to increase in the near future.

The signal strength indicates how much the current price deviates from what the system considers an equilibrium or “fair” price. The predictability is obtained by calculating the average correlation coefficient between the past predictions and the actual asset movement for three discrete time periods. You can learn more about it by clicking here : How to interpret this diagram

I Know First Algorithm has previously predicted AMZN stock movement like in this prediction of a 14-days period from February 10^th, 2016 until February 24^th, 2016. The AMZN signal was 2.25 with a predictability of 0.17 which managed to bring returns of 14.93% in only 14 days.