Are Amazon ETFs a Buy Ahead of Q4 Earnings?

Amazon AMZN is set to release fourth-quarter 2024 results on Feb. 6, after market close. Being a market leader in e-commerce, it is worth taking a look at the company’s fundamentals ahead of its results. See the Zacks Earnings Calendar to stay ahead of market-making news.Amazon stock has risen 21% over the past three months, outperforming the industry’s growth of 10.8%. The outperformance is expected to continue, given that the online behemoth has an increased chance of beating estimates in its quarterly report. It saw positive earnings revision activity, which is generally a precursor to an earnings beat.  Image Source: Zacks Investment ResearchGiven this, investors could tap this opportune moment through ETFs that have a double-digit allocation to this online behemoth. These include ProShares Online Retail ETF ONLN, Fidelity MSCI Consumer Discretionary Index ETF FDIS, Vanguard Consumer Discretionary ETF VCR, Consumer Discretionary Select Sector SPDR Fund XLY and VanEck Vectors Retail ETF RTH. Inside Our MethodologyAmazon has an Earnings ESP of +4.78% and a Zacks Rank #2 (Buy). According to our surprise prediction methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.The stock saw a positive earnings estimate revision of a couple of cents in the past 30 days for the fourth quarter. Analysts raising estimates right before earnings — with the most up-to-date information possible — is a pretty good indicator of some favorable trends for the stock. The Zacks Consensus Estimate implies massive year-over-year earnings growth of 50.5% and substantial revenue growth of 10.2% for the to-be-reported quarter. Additionally, Amazon’s earnings surprise history is impressive, with a surprise of 25.85%, on average, in the last four quarters (read: 4 ETF Sectors to Win Despite Moderate Retail Sales in December).  Amazon.com, Inc. Price, Consensus and EPS Surprise Amazon.com, Inc. price-consensus-eps-surprise-chart | Amazon.com, Inc. QuoteAmazon currently has a Wall Street analyst recommendation of 1.10 on a scale of 1 to 5 (Strong Buy to Strong Sell), made by 50 brokerage firms. Of these, 46 are Strong Buy and three are Buy. Strong Buy and Buy, respectively, account for 92% and 6% of all recommendations. Based on short-term price targets offered by 49 analysts, the average price target for Amazon comes to $256.84, ranging from a low of $212.00 to a high of $306.00. The stock has a solid Growth Score of A and falls under a top-ranked Zacks industry (top 28%), indicating that it is primed for growth. Solid Growth ProspectsAmazon soared to new all-time highs, given its continued dominance in e-commerce and expanding footprint in cloud computing, advertising, and various other sectors. Amazon’s AI business, already up by triple-digit percentages, is growing much faster than the cloud business at a comparable stage of evolution. The world's largest online retailer expects revenues in the range of $181.5-$188.5 billion for the fourth quarter of 2024. Like other tech companies, Amazon has been ramping up investments in data centers, chips and the power needed for AI workloads. ETFs in FocusProShares Online Retail ETF (ONLN)ProShares Online Retail ETF offers exposure to companies that principally sell online or through other non-store channels and then zeroes in on the companies that reshape the retail space. It tracks the ProShares Online Retail Index, holding 20 stocks in its basket. Amazon is the top firm, accounting for 23.9% of the portfolio.ProShares Online Retail ETF has amassed $78.5 million in its asset base and currently trades in a moderate volume of around 18,000 shares a day on average. It charges 58 bps in annual fees from investors. Fidelity MSCI Consumer Discretionary Index ETF (FDIS)Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 268 stocks in its basket. Of these, Amazon takes the top spot with a 22.5% share (see: all the Consumer Discretionary ETFs here). Fidelity MSCI Consumer Discretionary Index ETF has amassed $2.1 billion in its asset base while trading in a good volume of around 90,000 shares a day on average. It charges 8 bps in annual fees from investors and currently has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.Vanguard Consumer Discretionary ETF (VCR)Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 298 stocks in its basket. Of these, Amazon occupies the top position, with a 22.5% allocation. Broadline Retail takes the largest share at 24.9%, while automobile manufacturers, restaurants and home improvement retail round off the next three spots. VCR charges investors 9 bps in annual fees, while volume is moderate at nearly 55,000 shares a day. The product has managed about $6.9 billion in its asset base and currently carries a Zacks ETF Rank #3 with a Medium risk outlook.Consumer Discretionary Select Sector SPDR Fund (XLY)Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index. It is the largest and most popular product in this space, with AUM of nearly $24.6 billion and an average daily volume of around 3 million shares. Holding 51 securities in its basket, Amazon takes the top spot with 21.9% of assets. Hotels, restaurants & leisure, broadline retail, specialty retail, and automobiles are the top four sectors with double-digit exposure each. Consumer Discretionary Select Sector SPDR Fund charges 8 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.VanEck Vectors Retail ETF (RTH)VanEck Vectors Retail ETF provides exposure to the 26 largest retail firms by tracking the MVIS US Listed Retail 25 Index, which measures the performance of the companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers and food and other staples retailers. Amazon takes the top position in the basket with a 20.3% share (read: Retail ETF Hits New 52-Week High).VanEck Vectors Retail ETF has amassed $237.3 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 6,000 shares a day on average. VanEck Vectors Retail ETF has a Zacks ETF Rank #3 with a Medium risk outlook.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN): Free Stock Analysis Report VanEck Retail ETF (RTH): ETF Research Reports Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports Fidelity MSCI Consumer Discretionary Index ETF (FDIS): ETF Research Reports ProShares Online Retail ETF (ONLN): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks