Shares of Amazon.com, Inc. (AMZN - Analyst Report) touched a new 52-week high of $776.00 on Sep 2, eventually closing at $772.44. The company returned 54.8% in the past one year and has added roughly 14.3% year to date. Average volume of shares traded over the last three months was approximately 2,928K.

What's Driving Amazon?

Amazon is one of the largest online retailers in the world. We continue to believe that its platform strategy and Amazon Web Services (AWS), in which it has significant first-mover advantage, will spur growth in the future.

The price appreciation may be attributed to Amazon’s strong fundamentals, solid growth of AWS, its cloud service, and better-than-expected second-quarter 2016 results reported on Jul 28.

In the second quarter, Amazon reported profit of $1.78 per share that was way ahead of the Zacks Consensus Estimate of $1.14. The North America and AWS segments were strong contributors to profits while investments in international business continued.

Amazon’s revenues in the quarter were up 4.4% sequentially and 31.1% from the year-ago quarter to $30.40 billion. Excluding the $166 million favorable FX impact, revenues were up 30% year over year.

Also, management provided a solid guidance for the third quarter of 2016. Revenues including a 30 bps positive FX impact are expected at around $31–$33.5 billion (up 6.1% sequentially and 27.2% year over year at the mid-point).

The success of Amazon’s multi-faceted cloud computing service significantly boosted its second-quarter results. Cloud infrastructure service AWS contributed $2.89 billion to revenues, taking the revenue run rate to over $11.5 billion, representing sequential and year-over-year growth of 12.5% and 58.2%, respectively.

Another growth driver is the Prime subscription service. Prime users pay a yearly fee of $99 to receive benefits like free two-day shipping, special sales and Amazon Instant Video. As Prime users pay for the service, they typically try to use it as much as possible thus boosting sales for Amazon.

Fulfillment centers are also important since they keep up the level of service that Amazon customers are accustomed to. Over the past few years, the giant online retailer has been investing heavily in fulfillment and technology & content.

Other areas of potential growth are devices and IoT. Though IoT devices/technologies will not have a huge impact on results in the near term with no material revenue contribution, these could very well supplement the rest of the business by making purchase from Amazon easier.

Amazon has taken an aggressive stand to maintain supremacy in its chosen markets and its performance so far in the second quarter indicates that it is moving in the right direction.

Moreover, the Zacks Consensus Estimate for earnings jumped 361.9% for full-year 2016. Additionally, the company delivered an average positive earnings surprise of 90.9% in the trailing four quarters backed by its robust business portfolio.

Amazon currently carries a Zacks Rank #3 (Hold).

AMAZON.COM INC Price and Consensus

AMAZON.COM INC Price and Consensus | AMAZON.COM INC Quote

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Some better-placed stocks in the technology space are Autobytel Inc. (ABTL -Snapshot Report) and Stamps.com Inc. (STMP - Snapshot Report) , sporting a Zacks Rank #1 (Strong Buy), and PetMed Express, Inc. (PETS - Analyst Report) , carrying a Zacks Rank #2 (Buy).