How To Buy Amazon Shares in 2022 – Complete Guide

Just like everyone else, you’ve probably wondered about buying stock in a firm that will rise in value in a few years, allowing you to travel and relax for the rest of your life. Perhaps Amazon was or will be, one of your top options for stock purchases.

During the COVID-19 outbreak, the huge majority of big stocks suffered double-digit percentage losses, but Amazon was not one of them. On the opposite, the digital retailer’s increasing trend continues. When you buy shares from a broker, you’re actually buying a small piece of that corporation. Your shares will appreciate in value as the firm grows in value. Before you can learn how to buy amazon stocks, you must first grasp some fundamentals.

Is Amazon, on the other hand, a good investment? In this guide, we not only show you how to buy Amazon shares in the UK, but we also go over everything you need to know about Amazon shares.

In order to Buy Amazon Shares you need to follow these few steps below:

  • Step 1. Look for the Best Trading Platforms that offers Amazon Shares at minimum fees.
  • Step 2. Explore Amazon Shares
  • Step 3. Open an account and deposit your funds.
  • Step 4. Purchase Amazon Shares.

Step 1: Look for the Best UK trading platform to Buy Amazon Shares

Find a UK trading platform to buy Amazon shares online as your initial point of contact. With one of the greatest market capitalizations in the world, it should come as no surprise that several UK brokers now allow you to buy Amazon stock. This isn’t mean that all brokers should be considered. The brokers listed below, on the other hand, are perhaps the best in the financial business for trading or buying Amazon shares in the United Kingdom. Let’s look at our top two choices in more detail:

1. eToro

The Financial Conduct Authority (FCA) regulates eToro, and it is covered by the Financial Services Compensation Scheme  (FSCS). This broker stands out for a number of reasons, one of which is the fact that it has over 20 million customers.

eToro stands apart when it comes to fees. It’s because if you buy Amazon shares through a broker, you won’t have to pay any commissions or handling fees. Furthermore, eToro waives the 0.5 percent stamp duty payment on shares traded on the London Stock Exchange, such as Amazon.

How to Buy Amazon Shares - watch list

One of several distinctive features of eToro is that you may buy stocks in the classic sense as well as trade share CFDs. You can speculate on the price falling and utilize eToro’s 1:5 leverage to make larger deals by trading CFDs.

Another significant advantage of investing in Amazon with eToro is the low account minimums. This enables you to buy Amazon shares without putting too much money at risk. If you want to invest in stocks other than Amazon,like Apple, Netflix or Alphabet, eToro is the place to go. This is the situation because the broker offers around 2,400 shares from 17 different overseas stock marketplaces.

On average, it takes about 10 minutes to create an account. Simply fill out the form and upload a photocopy of your passport or driver’s license. You can then deposit using a debit/credit card or a bank account in the United Kingdom. Accepted e-wallets include Paypal and Skrill, to name a couple.

eToro is the way to go if you want to diversify your financial portfolio. Due to the company’s in-house operated CopyPortfolio feature, users’ funds are scattered throughout several businesses and regions. We recommend eToro for trading Amazon Shares UK and for your general trading needs.

Pros: 

  • Purchase shares without having to pay a commission or share dealing fees.
  • There are around 800 shares listed on the UK and worldwide stock exchanges.
  • Invest in stocks or trade CFDs.
  • Tools for social and copy trading
  • Accepts PayPal Trading App for Mobile
  • Has a license from the Financial Conduct Authority (FCA).
  • Invest in a variety of assets to diversify your portfolio.

Cons: 

  • Not for skilled traders who enjoy performing technical analysis.

2. Capital.com

Capital.com is a CFD broker that trades over 3,000 stocks in the United States, the United Kingdom, and Europe, including Amazon. Because the broker charges no commission on every trade, all you have to pay is a modest spread. This is usually roughly 0.1 percent of each stock transaction. You can also leverage your stock CFD trades up to 5:1, which is beneficial for day traders who want to be aggressive.

Capital.com’s trading platform, which uses artificial intelligence (AI) in a way that few rivals do, is one of its strongest features. The AI algorithm at Capital.com will scan the market for potential trading opportunities, then bring them to your notice for further research. You also get a charting interface with over 75 technical indicators, a news feed, and an economic calendar.

The interface of Capital.com is incredibly user-friendly, whilst being extensive enough for skilled traders. The trading interface is entirely customizable, and a mobile trading app for iOS and Android allows you to trade on the go. Furthermore, Capital.com provides a wealth of tools for new traders, making it an excellent brokerage for individuals just getting started with trading and investing.

How to trade amazon shares CFD

Capital.com registration takes only a few minutes, and the minimum deposit is only £20. You can practice trading Amazon CFDs with a little amount of money this way. A Capital.com demo account offers a risk-free trading environment.

The Financial Conduct Authority of the United Kingdom, one of the world’s top financial watchdogs, regulates Capital.com. Furthermore, UK accounts are covered by the Financial Services Compensation Scheme, which means you’re covered up to £85,000 if Capital.com goes bankrupt.

Pros: 

  • Over 3,000 global stocks are available to trade.
  • There are more than 75 technical indications.
  • Outstanding educational resources
  • Regulated by Financial Conduct Authority 

Cons:

  • There are no fundamental stock data available.

Step 2: Examine that Is it a good idea to invest in Amazon Share?

Despite the fact that Amazon has paid shareholders handsomely over the last decade or so, it is critical that you do your own research. In this section of our tutorial, we’ll go over some of the most crucial things to think about before buying Amazon stock.

Amazon overview

Amazon is a Seattle, Washington-based international technology and e-commerce corporation. It’s one of the “Big Four” technology corporations, together with Google, Apple, and Facebook, and one of the world’s most profitable and well-known businesses.

Jeff Bezos launched Amazon as Cadabra, Inc. in Bellevue, Washington in 1994, and it went public in May 1997. It is a participant of the NASDAQ-100, S&P 100, and S&P 500 stock indexes as one of the world’s largest corporations.

In contrast to growing as an online-retail giant, Amazon has produced products that have become common in UK families, ranging from the famous Fire Tv stick to the Echo (Alexa) and the Kindle. Because of its cloud computing service, AWS, and its data warehousing service, Redshift, it’s also popular with enterprises (amongst others).

Amazon debuted its “Prime” subscription program in 2005, which includes free delivery on Amazon purchases as well as access to streaming TV and music. Since 2015, Amazon has sponsored an annual “Prime Day,” during which Prime members can take advantage of a variety of exclusive offers.

Amazon Share Price

The initial price of Amazon stock was $18. The corporation was valued at just under $500 million as a result of this.

Buy Amazon shares - Price Chart

Amazon’s stock is currently trading at $3,242.76. This amounts to a 19279.1% gain in the stock price since its initial public offering (IPO) price of $18.

On July 8th, 2021, the all-time high Amazon share price per share was $3,731.41. Investors who didn’t buy Amazon stock when the price dropped below $2,900 earlier this year may have missed out.

In simple words, if you had invested £1,000 in Amazon in 1997, it would now be worth almost $1.34 million. Amazon now has a market capitalization of $1.63 trillion, putting everything into perspective.

Dividend for Amazon

Considering all of the above that Amazon is now one of the world’s largest, most successful, most profitable enterprises – it may come as a surprise that the corporation has yet to pay a single cent in dividends. When you consider the firm’s financial strength, this is a little strange.

The company, on the other hand, has stated that it intends to reinvest its dividends in order to keep the business thriving. After all, the corporation has diversified into a slew of other cutting-edge, cash-flow-heavy industries. Artificial intelligence, cloud computing, and digital streaming are all examples of this.

Also Read: Best Dividend Stock UK – Guide

What effect has the coronavirus had on Amazon’s stock price?

Amazon’s stock price has increased significantly after the stock market meltdown that began in February 2020.

Its most recent market closing was $3224.28, representing a 34.99 percent increase over its pre-crash value of $2095.97 and a 98.29 percent increase over the lowest point reached during the March 2020 crisis, when the shares plunged as low as $1626.0318.

If you had purchased $1,000 worth of Amazon shares at the beginning of February 2020, they would have been valued at $951.42 at the bottom of the March fall, and if you had held on to them, they would have been worth $1,612.14 as of the latest market close.

Amazon Stock Fundamentals

P/E ratio

The P/E ratio calculates the relationship between the price of a stock and its earnings per publicly traded share. The P/E ratio is derived by dividing the present market value of a stock by its income per share.

At the time of writing price/earnings ratio of Amazon’s share is 63.41. Let’s compare Amazon’s P/E ratio to that of a few other NASDAQ-listed blue-chip stocks:

Company StockP/E Ratio
Amazon (NASDAQ: AMZN)63.41
Apple (NASDAQ: AAPL)30.80
Facebook (NASDAQ: FB)23.50
Alphabet (NASDAQ: GOOGL)27.15
Netflix Inc (NASDAQ: NFLX)46.74
eBay Inc (NASDAQ: EBAY)3.46
Paypal Holdings Inc (NASDAQ: PYPL)42.89

PEG ratio

The PEG ratio is calculated by dividing the P/E ratio by the EPS growth rate of a stock. A PEG ratio of less than one suggests that a company’s stock could be a good investment. The PEG ratio is thought to function well with growth stocks. This refers to stocks that are outperforming the industry average in terms of profits growth.

As of December 11, 2021, Amazon’s PEG ratio was 2.05. A PEG ratio greater than one could indicate that the company’s shares are overpriced at the present rate of growth, or it could indicate that the company’s shares are undervalued at the current rate of growth.

EBITDA

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is a financial term that may be used to assess a company’s ability to generate cash flow for its shareholders as well as its operational performance.

At the time of writing, the Enterprise Value to EBITDA ratio of Amazon is $27.48 billion.

Environmental, social, and governance track record

Environmental, social, and governance (ESG) criteria are a set of three elements used to assess a company’s long-term viability and social impact.

Let’s take a closer look at Amazon’s risk ratings in terms of environmental, social, and governance, as reported by Yahoo Finance.

  • Environmental Risk Score – Amazon’s environmental risk score of 6.7 shows that the NASDAQ behemoth is among the frontrunners in terms of lowering its carbon emissions.
  • Social Risk Score – The company’s social risk score of 14.6 could indicate that it has solid management practices in place that cater to both its employees and the communities with which it interacts.
  • Governance Risk Score The ESG score for Amazon indicates that the firm has strong leadership, sufficient board independence, and sound corporate ethics, with a governance score of 9.7.

Step 3: Set up an account

If you’ve done your research on Amazon and still want to buy Amazon stock in the UK, we’ll show you how to do it with eToro, a platform that allows you to trade hundreds of stocks without paying a commission.

Step 1: Register Your Account

Simply go to the eToro website, click sign up, and enter your personal information in the relevant boxes. You will be asked to fill in your first and last name, your phone number, and also your email address.

How to buy amazon Shares - Open an account

You must validate your mobile number to complete the signup procedure. You’ll receive a code from eToro, which you must input when required on-screen. This section of the procedure should not take more than 5 minutes to complete.

Step 2: Verification

You will be asked to complete a brief KYC process in order for eToro to comply with anti-money laundering rules.

Please send the following two items to meet the requirement an electricity bill or a bank statement and also a passport or driver’s license.

Buy amazon shares -account verification

Step 3: Fund your account

You’ll be able to buy Amazon shares when you’ve registered an account and made a deposit.

You’ll have to make a $50 minimum deposit. Furthermore, fractional share trading allows you to purchase $50 worth of Amazon stock.

You may fund your account at eToro instantly using a debit/credit card, Skrill, Paypal, or Neteller. Bank transfers are also accepted.

The monies will be credited to your account immediately after you complete the deposit.

Step 4: Search for Amazon

Now that you’ve funded your eToro account, you’re ready to buy Amazon shares in the United Kingdom. Simply type “Amazon” into the top-right search toolbar of the website.

In the drop-down menu that displays, click the ‘Trade’ symbol next to the top result.

Step 5: Buy Amazon Shares

Fill in the box here with the amount of money you want to invest in Amazon shares. You can invest as much or as little as you want as long as the total is greater than $50.

Tap ‘Open Trade’ when you’re ready to buy Amazon stock.

Amazon Share Price Forecast for 2022

Analysts predict that by the end of 2022, Amazon’s stock price will have risen to almost $4,000 per share. They also predicted a possible high of $4,500, implying an astounding +40.5 percent annual growth rate.

They don’t expect the stock price to fall below $3,048 at the very least. While this is less than its current price of $3,242.76, investors need not be concerned. This is especially true because retail had a breakout year in 2020-2021. With revenue growth from the worldwide coronavirus epidemic leading the stock price to plummet to an all-time low, it wouldn’t be shocking if Amazon’s stock price in 2022 is slightly lower.

Amazon Shares are a Buy or Sell?

Now, to summarise, are Amazon shares a buy or a sell option? We believe it is the latter, as there is no reason to believe the eCommerce behemoth would falter in 2022. Amazon’s development through new operational and business model enhancements has helped the company to survive in the midst of the COVID-19 outbreak and these improvements look destined to help boost share price even more in the future.

Furthermore, Amazon’s advertising and cloud-computing services continue to expand and generate significant revenue. Many prominent rating organizations have lately raised their price estimates for Amazon, with JPMorgan expecting that it will reach between $4,350 and $4,500!

In conclusion, we believe Amazon is a smart buy option. Amazon’s long-term prospects are bright, and the company’s ongoing product and service innovation ensure that it does not become stale.

Conclusion

Because Amazon’s stock price is so high, you should think about your long-term investing goals before becoming a shareholder. While the company retains its blue-chip status and has a track record of strong growth, it’s also crucial to keep an eye on some of its rivals.

Despite the fact that Amazon’s stock has recently risen significantly, no corporation is immune to risk. The success of a stock is influenced by a variety of factors, including rivalry, climate, and the economy. As a result, while considering a purchase, potential investors should do a thorough analysis of a company.

This post has shown you how to buy Amazon shares online in the United Kingdom. We came to the conclusion that eToro is the ideal alternative for this purpose because you can buy Amazon shares without paying a commission and the entire process takes only minutes.

Frequently Asked Questions

When Amazon initially went public, how much did its stock cost?

Amazon went public in 1997, barely three years after Jeff Bezos founded the company. You would have paid only $18 per share at the time.

What is the value of Amazon stock?

Amazon’s stock is worth $3224.28 per share at the time of writing in January 2022. This is a drop of about 8% from the all-time highs reached in April 2021.

Is Amazon a dividend-paying company?

Despite the fact that Amazon has been in business for over 26 years and is now worth a trillion dollars, it has yet to pay any dividends. Investors, on the other hand, are unconcerned, as the company’s steadily rising share price has produced some remarkable gains.

When I buy shares on eToro in the UK, would I have to pay a conversion fee?

In the vast majority of situations, though. While some brokers, such as eToro, charge 0.5 percent when you make a deposit, others charge this when you acquire the shares. In any case, the UK average is 0.5 percent.

What is the least amount of Amazon stock I can buy?

For many people, purchasing a single share of Amazon is unaffordable, especially at its current price of $3,242. However, brokers such as eToro allow fractional ownership, which means you can buy a portion of an Amazon share. In fact, you can start investing as little as $50 (about £35!).

What is the total number of Amazon shares?

According to data from the NASDAQ website, there are currently 504 million shares outstanding. Institutions such as mutual funds, pension funds, insurance companies, and others own 58.12 percent of these shares.

Is it possible to buy Amazon stock in fractional shares?

Yes, many brokers, including Amazon, allow investors to buy fractional shares of stock.

This is an excellent option for smaller investors to own a piece of Amazon when the stock’s high price prevents them from purchasing a complete share.

Verify that fractional investing is available through your brokerage.

When should you sell your Amazon stock?

There is no right or wrong answer when it comes to selling Amazon shares.

Some investors may sell their shares if they believe the company is no longer worth as much as the share price represents.

So, before you invest in Amazon, think about why you bought the stock in the first place. Then you’ll be able to tell when the company is no longer a viable investment.