A 'Global Elite' E-Commerce Giant That's Set to Soar After a Major Announcement

Regular readers should be familiar with the phrase "Global Elite"...

These companies are the biggest and best in their industries. They dominate the competition.

They have fortress-like balance sheets – and their brands and businesses are well-known all around the world.

Thanks to their position, these behemoths' shares usually command premiums in the market, making them more expensive than most stocks. But when they sell off, we take note. And when they sell off by more than 20%, we really get interested...

Amazon (Nasdaq: AMZN) is the dominant leader in e-commerce in the U.S. Consumers can buy nearly anything they need through its online platform.

Amazon's online business brings in more than 40% of all e-commerce sales in the nation. So when people are buying products online, it's likely that they're turning to Amazon.

And the e-commerce trend has only accelerated in recent years, with the pandemic forcing people to order the products they need online.

Because of this high demand, Amazon has gone on a massive hiring push, adding hundreds of thousands of workers throughout the pandemic to get orders out on time.

But e-commerce isn't the only business this company dominates... It offers a plethora of web-based services. Amazon can store your photos or host your website on its cloud. You can even stream popular movies and TV shows on Amazon Prime Video.

It also owns grocery chain Whole Foods, meaning it benefits from the surge in online grocery delivery too.

Amazon has booked insane growth by having a fundamentally different approach than any other company we know. It focuses on the long-term view...

"If everything you do needs to work on a three-year time horizon, then you're competing against a lot of people," founder Jeff Bezos said in a 2011 interview with Wired magazine. "But if you're willing to invest on a seven-year time horizon, you're now competing against a fraction of those people, because very few companies are willing to do that."

But Amazon's biggest success is its cloud-computing business – Amazon Web Services ("AWS"). AWS has changed the way the Internet works.

Prior to AWS, a business that needed an IT setup to host websites or databases could spend tens or hundreds of thousands of dollars and work for weeks to get their own servers up and running. With AWS, deploying the same capabilities takes just hundreds of dollars and less than a day.

That's why major companies like Netflix (NFLX), Comcast (CMCSA), and 3M (MMM) use AWS to host services.

Now, AWS is the leader in cloud computing, much like Amazon is the leader in e-commerce. It makes up about one-third of the world's cloud-services market. That's more than the next two closest competitors' market share combined.

In short, this is a business that anyone would love to own. And now, it's becoming more accessible for everyday investors...

Last week, the company announced a 20-for-1 share split. The split will happen on June 3, where shareholders of record on May 27 will receive 19 additional AMZN shares.

The split means that each AMZN share will be exchanged for 20 shares. And the price of Amazon's stock will be divided by 20. So any investor's AMZN stake would be worth the same – they would just have 20 times the shares at 1/20th the price.

Amazon's current share price sits at $2,910, as of Friday's close. That means it's more expensive for individual investors to add the company to their portfolios. Some brokerages may allow these investors to buy fractional shares of AMZN, but the high share price limits who can buy full shares of AMZN.

But that's about to change...

A 20-for-1 share split would bring the stock price down to about $145 (if it happened today) – making it a lot more affordable for the everyday investor. And that could bring a flood of demand.

The split could also make Amazon eligible for inclusion in the Dow Jones Industrial Average. This would further drive up demand for Amazon shares, as any index funds that track the Dow would have to buy up AMZN shares to match their benchmark.

You may think that with its world-class business, Amazon would be trading at or near all-time highs. After all, if it dominates every industry it enters... surely it must be one of the best-performing stocks out there. And that's true when you look at the long term. The stock has more than tripled over the past five years.

However, short-term "noise" is an opportunity for investors...

You see, over the past few months, investors have soured on high-growth technology stocks. The Nasdaq Composite Index is off nearly 20% from its all-time high set in November. And despite Amazon being a great business, its shares have fallen alongside tech. Now, shares sit more than 20% below their November highs.

Amazon is a world-class business that dominates almost every industry it enters – like e-commerce and cloud computing. Nothing has changed in the underlying business over the past few months, but investors have still pushed the share price of this Global Elite lower. That sets up a great opportunity in one of the best companies out there.

Sometimes investing is simple.