But should I buy any of the shares when it goes public? Let’s take a look at the opportunity here.

A generational opportunity?

There’s no doubt that this is a very exciting company. This is a business that offers exposure to satellite broadband/mass connectivity, orbital AI data centres, defence contracts, and much more.

In terms of its total addressable market (TAM), the company believes that it has identified the largest actionable TAM in human history. It sees a TAM of a whopping $28.5trn.

One key growth driver for the group is Starlink. Today, SpaceX has nearly 10,000 Starlink broadband and mobile satellites in Low-Earth Orbit, providing internet connectivity to approximately 10.3m Starlink Subscribers across 164 countries, territories, and other markets.

Last year, revenue in its Connectivity segment, which includes Starlink, was up 50% year on year. So, this area of the business is growing rapidly.

Our mission is to build the systems and technologies necessary to make life multiplanetary, to understand the true nature of the universe, and to extend the light of consciousness to the stars.
SpaceX

Could I lose money on SpaceX?

Digging deeper though, the valuation here is a little hard to digest. Right now, analysts are talking about a figure of $1.75trn.

This is an issue because last year, the company only generated $18.7bn in revenue. So, we’re looking at a price-to-sales ratio of about 94, which is extremely high.

The other thing to note about that $1.75trn valuation is that it would make SpaceX one of the most highly valued companies in the world. At that valuation, it would be bigger than Berkshire Hathaway, Tesla, and Meta.

I think buying at that valuation could limit future returns (and/or lead to losses). For the stock to rise 50%, the valuation would have to climb to $2.6trn.

A better space stock?

Given the sky-high valuation, there are better ways to play the space theme, in my view. One such way is Amazon (NASDAQ: AMZN).

Not many people know it, but this company is quietly building a massive space satellite network (Amazon Leo). Over the last seven years, it has put more than 200 satellites into space and in the years ahead it plans to launch thousands more.

Now, with this stock, we don’t need to worry about a crazy valuation. Because it looks relatively cheap.

It currently trades on a price-to-sales ratio of less than four. At that multiple, I believe very little of the space potential is priced into the stock.

Of course, there are no guarantees that Amazon will be a good investment in the years ahead. It faces plenty of risks including a slowdown in the economy and increased competition from rivals.

However, given its diversified business model (e-commerce, chips, cloud computing, space, etc), I like the risk/reward proposition. I believe this stock is worth considering.

Should you invest £5,000 in Amazon right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Amazon made the list?

Edward Sheldon owns shares in Amazon and Nasdaq

The post Should I buy SpaceX shares for my ISA after the IPO on 12 June? appeared first on The Twelfth Magpie.

Recently, I was looking at the April factsheet for this fund, as well as a recent Q1 regulatory filing, and I noticed that Ackman has made huge bets on two of my favourite US stocks. This suggests that he sees value in them at present.

Decades-long growth potential

The first stock I want to highlight is Amazon (NASDAQ: AMZN). At the end of Q1, it represented about 17% of Ackman’s total portfolio.

I’m not surprised that the hedge fund manager is bullish on this Mag 7 name. In my view, it has a ton of long-term potential.

This is no longer just a play on online shopping and cloud computing. Today, it’s a play on these industries plus AI chips, space satellites, self-driving cars, digital healthcare, and more.

Put all this together, and there’s potential for the company to get much bigger. I think it could easily double in size in the next five to seven years (Ackman is expecting earnings growth 20%+ over the medium to long term).

Amazon operates two of the world’s great, category-defining franchises between its Amazon Web Services (AWS) cloud business and its e-commerce retail operations. Both businesses are underpinned by decades-long secular growth trends.
Bill Ackman

As for the valuation, it doesn’t look stretched, despite the fact that the stock is trading near record highs. Looking at earnings forecasts for next year, the forward-looking price-to-earnings (P/E) ratio is only about 27.

At that valuation, I think the stock is worth considering. There are risks around AI spending, but overall, I see the risk/reward set-up as compelling.

A big bet on mobility

Another massive holding for Ackman is Uber (NYSE: UBER). At the end of Q1, this stock was over 15% of this portfolio.

Again, this doesn’t really surprise me. To my mind, Uber – with its scalable platform – has the potential to be a Mag 7-like name in the future.

The stock market clearly underappreciates the durability of Uber’s moat, the magnitude of its earnings growth, and the strategic role it will play in shaping the future of mobility.
Bill Ackman

Now, some investors see competition from robotaxi players such as Tesla and Waymo as a major risk here. However, the way I see it, lots of automotive companies will have robotaxis in the future and many of them will partner with Uber to connect with consumers.

It seems Ackman shares a similar view. “We believe that AV technology will not be a winner-take-all model and that third-party networks, and Uber in particular, have a valuable role to play”, he wrote in his company’s annual report.

At present, Uber trades at less than 20 times next year’s earnings forecast. And Ackman sees that as a ‘bargain’ as he expects earnings to grow by 30% or greater over the medium term.

I agree that it’s a bargain and believe it’s worth a look today. There’s no guarantee that it will do well given the changing automotive landscape but there’s certainly a lot of potential.

Should you invest £5,000 in Amazon right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Amazon made the list?

Edward Sheldon owns shares in Amazon and Uber.

The post Bill Ackman’s FTSE 100 growth fund is making a huge bet on these 2 AI stocks appeared first on The Twelfth Magpie.

There’s one key mistake that a lot of investors make with these accounts however. This mistake can set them back significantly, and prevent them from achieving their financial goals.

Portfolio management 101

It’s no secret that avoiding big losses is important when it comes to building up a large ISA portfolio. If a stock you own falls by 50% or more, it can really hurt your progress (you need to generate a 100% gain just to breakeven on a stock that falls 50%).

Now, most investors use diversification (spreading capital out over many different stocks) as a risk management strategy. And that’s smart. But there’s another portfolio management tool that can be even more effective. And that’s ‘right sizing’ positions. In my view, this is the secret to investing success. Ignoring it is a mistake.

How to size portfolio positons

When it comes to sizing portfolio positions correctly, there are no set rules. Generally speaking though, the idea is to balance risk and reward. Ideally, your largest holdings should be reliable blue-chip stocks that are unlikely to tank and result in permanent loss of capital (but still offer the potential for solid returns). More speculative stocks – where there’s risk of major losses – should be smaller holdings.

By constructing a portfolio this way, an investor can give themselves a much better chance of success. Done properly, there’s far less chance of ugly losses.

Even if a few more speculative holdings blow up, it won’t be the end of the world. Because the large blue-chip holdings should offer protection.

How this strategy has saved me

To illustrate how this works in reality, here’s a look at how it has helped me in recent years. I’ve had my fair share of portfolio losses – stocks I’ve owned that have tanked include JD Sports Fashion, Kainos, and Zscaler.

These were all small positions for me though. So losses were manageable.

Importantly, gains from my larger, blue-chip holdings have offset the losses. For example, my gains on Amazon (NASDAQ: AMZN) stock – my largest holding – have more than made up for the losses on those other names.

So allocating more capital to rock-solid companies has paid off. By right-sizing my positions, I’ve protected myself from losses.

A blue-chip stock to consider today?

Why is Amazon my largest holding? A few reasons. For a start, it’s a well-established company that operates in a number of industries including e-commerce, cloud computing, chips, streaming, and space. So it’s unlikely to see its revenues suddenly plummet.

Second, it’s strong financially. This is a company that generates a ton of cash flow and has a rock-solid balance sheet.

Third, it still has a lot of growth potential, despite the fact that it sports a market-cap of $2.8trn today. Looking ahead, chips and space could be huge growth drivers.

Of course, there are no guarantees that it will be a good investment for me from here. If we were to see a major global economic contraction, business performance could be compromised.

Taking a five-year view though, I see a lot of potential. In my view, this stock’s worth a closer look.

The post 1 major investing mistake that can drain your Stocks and Shares ISA appeared first on The Twelfth Magpie.

It’s one of the largest investments in my Stocks and Shares ISA. But should I be concerned about declining free cash flows?

Results 

Amazon delivered on sales and profits in Q1. It also delivered me a new ice cream scoop after I put my one in the dishwasher. That last bit is neither here nor there. But 17% sales growth and a 74.8% increase in earnings per share are very important. 

The company’s net income was boosted by a revaluation of its stake in Anthropic. So that’s not likely to be ongoing, but I’ll come back to this.

With Amazon, it makes a big difference which parts of the firm are growing the fastest. And the Q1 report is terrific on this front. The outstanding divisions were Advertising (+22%) and Amazon Web Services (AWS +28%). These come with high margins, but they matter for another reason.

For AWS, the quarter marked growth getting stronger. And this is extremely important in the current environment.

AWS

Amazon has been spending heavily on data centres and it looks set to keep going. And investors have been wary about this. I think they’re right to be cautious. Even if demand’s strong, there are a number of other obstacles in the way of earning a return.

A major one is power. Data centres take a lot of electricity and this is causing a number of US states to consider imposing a moratorium on new builds. On top of this, there are supply chain challenges. Things like memory have become much more expensive as demand has soared.

That’s why AWS growing at its fastest rate for four years is so important. It’s a sign that Amazon’s spending is working – at least, for now. 

That’s why the stock is rising. And I think the stock market’s response to the company’s latest earnings is the right one. 

Amazon’s DNA

Amazon is investing heavily in artificial intelligence (AI). Not just in terms of building data centres, but also by designing its own chips. The costs involved are huge. But being fearless and looking for the next big opportunities is central to the type of company Amazon is.

When it goes wrong, it can go really wrong. The company’s investment in Rivian Automotive was a mistake that sent 2022’s earnings negative.

When it works, however, the results can be spectacular. And there’s no better illustration of this than the recent boost to the firm’s stake in Anthropic.

Obviously, it would be great to have all the successes without the failures. But that isn’t realistic, so investors have to choose between neither or both. A lot of this comes down to the firm’s management. And my view is very positive – so what should my next move be?

What I’m doing

A lot of the time, the best thing to do is to be patient. And that’s what I’m doing with Amazon. The stock’s a big part of my portfolio, so I’m not looking to buy right now. But others who don’t have this issue might be interested to do further research.

The post Amazon stock climbs after Q1 earnings! Here’s what I’m doing next appeared first on The Twelfth Magpie.

The rapid growth has raised concerns over sustainability amid the backdrop of the Iran war. A small group of major tech stocks are driving the growth, many of which are publishing results this week.

Alphabet, Microsoft, Amazon (NASDAQ: AMZN) and Meta are all scheduled to report earnings on Wednesday with Apple reporting the following day.

So the question is: will their performances validate the growth, or could it all be a house of cards?

Heavy concentration

With a combined value of around $16trn, these five tech giants make up approximately one-quarter of the entire S&P 500’s market capitalisation.

So it’s fair to say we could be in for a volatile week. Even if just one of the companies falls short of expectations, it could have a significant impact on the market.

FactSet says the S&P 500 is on track for about 15.1% year-on-year earnings growth for Q1 2026, while the Information Technology sector is expected to be the main driver of that expansion.

Naturally, upbeat guidance would keep the growth picture intact and could push estimates higher.

But what could go wrong?

Identifying weakness

Out of the five, Amazon looks the most vulnerable to missing expectations. The main reason is that recent commentary flags stagnant revenue trends, rising spending, and the possibility that operating income could even contract.

That makes it feel a bit more fragile than the others.

That said, the company’s recent results hardly look disappointing.

Let’s take a quick look at some numbers:

• Fourth quarter net sales: up 14% to $213.4bn.
• Annual 2025 revenue: $716.9bn (up from $638bn in 2024).
• Full-year operating income: $80bn in 2025 (versus $68.6bn in 2024).

These numbers suggest that profitability is still improving alongside scale. That back’s the narrative that Amazon remains an appealing US tech stock to consider in the long run.

So what’s the concern?

Execution risk

What matters is that Amazon has been spending heavily on logistics, cloud infrastructure, and AI-related capex.

So now investors are watching whether those investments keep converting into meaningful cash flow.

Risk-wise, if AWS growth slows, retail margins weaken, or AI capex fails to translate into better returns, the market could punish the stock quickly.

So the biggest risks are execution and valuation.

The bottom line

The market’s reaction this week will probably depend as much on guidance as on the headline numbers. At these high valuations, investors are paying for sustained growth, not just a one-quarter pop.

So, even if they report well but guide conservatively, the S&P 500 could still struggle to extend gains.

What does this mean for UK investors?

Even for those without significant US exposure, the knock-on effect could cause volatility within the UK market.

Having a highly diversified portfolio supported by defensive shares can help reduce risk. A few popular options on the FTSE 100 include GSK, AstraZeneca, and National Grid.

But it’s a constantly evolving market, so keeping abreast of developments is key to good portfolio management.

The post Is the S&P 500’s growth sustainable? Here’s what UK investors should watch appeared first on The Twelfth Magpie.

Can the Magnificent 7 stock continue to climb from here? Let’s take a look at the set-up.

Investors are now seeing Amazon’s potential

The main driver of Amazon stock over the last month – looking beyond the general improvement in investor sentiment – has been the company’s annual letter to investors, which was posted on 9 April. This was literally a game changer.

In this letter, CEO Andy Jassy outlined some potential growth drivers for the company. He also provided some insights into the performance of different areas of the business.

Perhaps the most important part of the letter was discussion of the company’s AI chip business. This is now doing $20bn in annual revenue, and growing at a triple-digit rate year on year (ie, faster than Nvidia).

However, Jassy noted that if Amazon’s chip business was a standalone company, and produced chips for third parties, revenue would be around $50bn annually (close to what Broadcom is doing in AI product revenue). I have no doubt that this comment has boosted the share price.

Another important part of the letter was discussion of the company’s low earth orbit space business, Amazon Leo. This now has more than 200 satellites in operation, and the company plans to add several thousand more in the years ahead (meaning it could be a serious rival to SpaceX).

Amazon Leo isn’t officially scheduled to launch until later this year, however, it has already signed some major customers. For example, US airline giant Delta Airlines is going to use the service to power its onboard wifi.

One other thing worth mentioning is that Jassy explained why Amazon is investing so much money in AI infrastructure ($200bn this year). Ultimately, the company sees AI as a major opportunity and it expects to monetise this capex within a few years.

Growth may not be in a straight line

After this letter, I think investors are starting to see the long-term potential here. This is no longer just a play on online shopping and cloud computing – it’s a tech powerhouse that could potentially dominate a broad range of industries including e-commerce, AI, semiconductors, space, digital advertising, and digital healthcare.

Of course, growth may not be linear (ie, a straight line). Jassy touched on this in the annual letter, stating that Amazon’s cloud business, AWS, has faced obstacles over the years and has had to move in different directions than originally anticipated at times.

This brings me to Amazon’s Q1 earnings. These will be posted on Wednesday (29 April) after the US market closes.

They may not be perfect. There’s a chance that the stock could fall if investors hear something they don’t like.

A stock to consider buying

If the stock does fall, I think investors should consider taking advantage of the weakness. I think it’s worth a look even if it doesn’t fall.

Because in the long run, I think this Mag 7 name is going considerably higher. Note that at present, the forward-looking price-to-earnings (P/E) ratio using the earnings forecast for 2027 is only around 27, so the stock isn’t particularly expensive today.

The post £3,000 invested in Amazon stock 1 month ago is now worth… appeared first on The Twelfth Magpie.

The key to this is its business model. But there’s a UK firm with a £6.24 share price that I can see doing something similar – and investors haven’t noticed yet.

Amazon

While AWS is often the focus for investors, Amazon’s marketplace is its largest revenue stream. It’s the biggest and the best in the industry by miles.

The trouble is, margins in this part of the business aren’t intrinsically huge. But that misses an important point. 

Amazon uses its marketplace strength to generate other high-margin revenue. Specifically, this comes from its Prime membership.

The company uses this to put its marketplace even further ahead of its rivals, which leads to more subscriptions. And so on.

This is an extremely powerful business model. And I can see a FTSE 250 company that’s looking to make a similar move.

JD Wetherspoon

I’ve been a bit lonely in having a positive view of JD Wetherspoon (LSE:JDW) shares recently. And that’s fair enough.

Investors have been concerned about the impact of cost inflation. That’s been true across the industry, but especially with the FTSE 250 firm.

A focus on customer value seems to limit its ability to offset rising costs with price increases. And management reinforced this view.

In its last update, the company stated that this year’s profits might be lower than expected. And the stock has been faltering as a result.

There’s no way around the fact that higher costs are a risk. But I see the company making a move to replicate Amazon’s business model.

Franchises

Until recently, JD Wetherspoon hasn’t had a source of revenue like Amazon’s high-margin subscriptions. But that’s changing.

The firm has started opening franchised venues run by local operators. And Wetherspoon’s provides the central admin and IT systems.

Importantly, partners also benefit from the company’s buying power. This gives them huge cost savings. 

That’s been the key to JD Wetherspoon’s lower prices. So it’s a huge advantage for these partner venues. 

Early signs are that this has been transformative for the venues, which is great. But it’s the FTSE 250 firm I’m interested in.

A game-changer?

What does JD Wetherspoon get from letting other operators use its supply chain? Three very big, very important advantages.

The first is a franchise fee (as well as a possible percentage of revenues). And this comes at virtually no cost to the company.

The second is that the firm benefits from expansion with none of those rising costs. These are left to local operators. 

The third is that it gets additional scale. And this reinforces the firm’s key strength, which is its ability to buy in bulk.

I think those are some key advantages. Especially with rising costs making things tough for hospitality companies.

A bargain buy?

JD Wetherspoon’s scale has always given it a cost advantage. But it’s starting to turn this into a source of high-margin revenues.

This could be extremely powerful. It both reinforces the firm’s key competitive strength and widens its margins in a time of higher costs.

It’s the model that’s worked for Amazon. And it’s another reason I think investors should take a closer look at £6.24.

The post How this £6.24 UK stock is copying Amazon’s winning tactics appeared first on The Twelfth Magpie.

As for my largest S&P 500 holding today, it’s a Mag 7 stock. But it’s not one of the names mentioned above.

A tech powerhouse

Instead, it’s Amazon (NASDAQ: AMZN). This is the company I’m most confident in from a long-term risk/reward perspective.

What I love about Amazon is that it’s a really diversified business. Ultimately, it’s a technology conglomerate. Everyone knows that it’s a powerhouse in e-commerce. This division underpins the group, generating a huge amount of cash flow for the company every year (group operating cash flow last year was $140bn).

One competitive advantage the company has here is that it has hundreds of millions of Prime members. These customers (myself included) tend to do a lot of shopping on the platform.

Looking beyond e-commerce, Amazon’s the largest player globally in cloud computing. This division continues to generate strong growth (24% growth in Q4 2025).

Note that in the years ahead, the cloud computing industry is expected to see rapid growth due to the AI revolution. So Amazon has some powerful tailwinds here.

A major player in AI

Speaking of AI, Amazon’s a big player here. A good example is its AI chips. In its recent annual letter, the company said that if it was selling its chips to third parties, it would be generating annual revenue of around $50bn. In other words, it’s fast becoming a major competitor to Nvidia.

It’s also worth pointing out that Amazon’s a major investor in AI powerhouse Anthropic. It owns around 15%-20% of this company.

Digital advertising growth

Additionally, Amazon’s a dominant force in digital advertising. Today, it’s the third largest player behind Alphabet and Meta. In Q4, this area of the business grew 22% year on year to $21bn. So this is a whole new growth driver for the group.

Space revenues

One other area of the business worth mentioning is space. Over the last decade, Amazon’s built its own low earth orbit satellite network with more than 200 satellites.

This is scheduled to launch in mid-2026. However, already the company has meaningful revenue commitments from the likes of Delta Airlines, NASA, and Vodafone.

Many ways to win

Looking beyond all this, Amazon’s also a force in robotics (it has over a million robots operating in its factories), self-driving cars (its Zoox cars are in operation in the US today), and digital healthcare (its platform now offers weight-loss drugs).

So overall, it has many ways to win. That’s one of the reasons I see the risk/reward skew as attractive.

Another is the valuation. Today, the stock trades on a mid-20s price-to-earnings ratio. I see that multiple as very reasonable given the long-term growth potential. That’s why I’m comfortable with a large position.

Worth a look?

Of course, there are plenty of risks. One is in relation to the amount of money the company’s spending on AI ($200bn this year) – it may not pay off. Another is a consumer slowdown. This could hurt e-commerce growth.

Overall though, I’m very bullish here. I think Amazon’s worth a closer look today.

But it’s not the only S&P 500 name I like right now…

The post The largest S&P 500 holding in my ISA is… appeared first on The Twelfth Magpie.

In it, CEO Andy Jassy made it clear that Amazon still has a ton of growth potential. Not only is the company seeing strong demand for its cloud computing and AI solutions but it’s also seeing high demand for its space satellite services. With that in mind, I think SpaceX isn’t the only game in town for those interested in what happens beyond the stratosphere.

The AI opportunity for Amazon

I’d advise anyone who owns Amazon stock, or is thinking about buying it, to read the annual letter, because it provided some powerful insights into the company’s roadmap.

On the AI front, Jassy explained why the company is spending $200m this year, noting that it’s not being invested on a hunch. Ultimately, the group expects to monetise this capex in 2027-2028 and is willing to endure short-term free cash flow headwinds for the substantial medium-to-long-term opportunity.

Jassy added that he’s followed the public debate on whether AI is over-hyped, whether it’s a bubble, and if margins and return on invested capital will be appealing. His views are no, no, and yes.

“AI is a once-in-a-lifetime opportunity where the current growth is unprecedented and the future growth even bigger. We’re not going to be conservative in how we play this – we’re investing to be the meaningful leader, and our future business, operating income, and FCF will be much larger because of it.”
Amazon CEO Andy Jassy

Perhaps the most interesting segment of the AI discussion was the section on chips. Jassy said this area of the business is “on fire“, and will be “much larger than most think”.

The chips business has an annual revenue run rate of over $20bn, and it’s growing in triple-digits year on year. Jassy said if chips was a standalone business with products sold to other parties, the annual run rate would be closer to $50bn.

“There’s so much demand for our chips that it’s quite possible we’ll sell racks of them to third parties in the future.”
Amazon CEO Andy Jassy

Space revenues coming

Looking beyond AI, another really interesting area of focus was space. Here, Jassy explained that the company has built a low Earth orbit satellite network (Amazon Leo) with more than 200 satellites. This makes it the third-largest low Earth orbit network in operation today behind SpaceX and Eutelsat OneWeb.

This service – which is expected to see a few thousand more satellites added in the years ahead – is officially scheduled to launch in mid-2026. However, already the company has meaningful revenue commitments from enterprises and governments such as Delta Airlines, NASA, and Vodafone.

An investment opportunity?

There’s clearly a lot to be excited about as an investor, especially as it trades on a price-to-earnings (P/E) ratio of just 25 using next year’s earnings forecast (SpaceX looks like it may trade at 130 times sales).

There are significant risks, of course. These include major competition from the other cloud computing companies, a slowdown in consumer spending that’s an ever-present issue for Amazon, and general market weakness.

Taking a five-year view though, I see huge potential. I’ve made Amazon my largest holding and I think it’s worth considering.

The post Forget SpaceX? Amazon stock offers exposure to space cheaply appeared first on The Twelfth Magpie.

The space age

To understand the strategic logic, it’s important to know what Globalstar does. It’s a satellite telecommunications company that operates a Low Earth Orbit (LEO) constellation. It can therefore provide call access, high-speed data, tracking services and much more.

At the moment, SpaceX’s Starlink dominates the orbital internet service arena. It has thousands of satellites in orbit and millions of users globally. From the rumours around the purchase, it’s clear to me that Amazon wants to fast-track its LEO satellite ambitions and close the gap with Starlink. Right now, Amazon’s own network is still in its early stages of build-out.

Buying Globalstar would effectively give Amazon a shortcut. It can leverage existing satellites and infrastructure rather than building everything from scratch. Even at a potential price of $9bn, it’s a small price to pay for the big tech giant with a current market-cap of $2.2trn.

Share price potential

Things get even more interesting when you start to distil the potential benefits down to the stock. Investors like it when companies diversify operations, providing new revenue streams that are uncorrelated to the existing operations. This deal positions Amazon not just as an e-commerce or cloud giant, but as a serious player in what could become a multi-billion-dollar space internet market.

That’s the thing as we’re not talking about a niche tech experiment here. I saw a statistic that roughly three billion people globally still lack reliable internet access, and even in developed markets, there are significant coverage gaps. That’s where LEO satellite networks come in, and why SpaceX’s Starlink has already gained millions of users so quickly.

If Amazon can credibly challenge Starlink, it opens up a whole new long-term revenue stream layered on top of normal operations. Add in the fact that Globalstar has already been validated by partners like Apple (which owns a 20% stake since 2024), and I can see why it could positively impact the Amazon stock price.

Tempering enthusiasm

Of course, I need to be realistic. Firstly, the deal might not go through. As part of any negotiations, Apple would also need to be supportive of a sale, which might be tricky. Further, trying to pin down exactly how much revenue or positive impact it could have on the stock is impossible at this stage.

Despite those concerns, my gut tells me that this is a smart play from Amazon, and that the sector could be huge. On that basis, I’m thinking about adding the stock to my portfolio.

The post Why Amazon stock could soar with a rumoured new acquisition appeared first on The Twelfth Magpie.