Amazon (NASDAQ: AMZN) is an incredible company that has proven its abilities are strengthening as time passes. It's a very interesting company that adapts quickly and never seems to have a desire to stop coming up with new and different ways to make money. One of the most interesting ways the company has decided to start turning a profit was by joining forces with Wells Fargo (NYSE: WFC) in order to start offering student loans. Today, we'll talk a bit about Amazon's success, what experts think of the company, and how the recent partnership with Wells Fargo can have an incredible impact on the company's stock price moving forward.
Amazon Has Had An Incredible Run Over The Past Year
While other stocks have seen a slight gain in the best case and declines in the worst over the past year, Amazon has performed incredibly well. While the past year has been an incredibly hard one on the market overall, Amazon has climbed dramatically. In fact, the stock is up about 40% from just one year ago.
If the performance of Amazon over the past year isn't quite enough to get you excited, all you need to do is take a quick look at analyst coverage on the stock. Considering the current global economic climate, the fact that analysts are so bullish can be shocking to many. Nonetheless, according to NASDAQ, there are currently 28 analysts weighing in on the stock. Of the 28 analysts that were surveyed, 23 rate the stock a strong buy, 3 rate the stock a buy, and 2 rate the stock a hold. Notice that there is not one sell or strong sell recommendation here.
Finally, earnings have been a big hit for Amazon as of late. In fact, the company has a strong history of beating analyst expectations. In the past 7 quarters, Amazon has reported earnings ahead of expectations 5 times. Considering this, the coming earnings report is likely to have incredibly upside implications on the stock.
This Brings Us To The Wells Fargo Partnership
All in all, it's clear that Amazon is a strong investment choice. However, was the decision to partner with Wells Fargo a good one for the company? How is the stock likely to benefit from this partnership in the long run? Well first, it's important that you understand exactly how this partnership works.
As we know at this point, Amazon and Wells Fargo recently signed an agreement. Under the agreement, Amazon will be essentially selling Wells Fargo brand student loans. Of course, Amazon will be earning a commission on all sales through its platform.
At the moment, student loans are a major issue for the US economy, especially considering that most of them are using Federal money and many go unpaid. However, lenders see a great opportunity here and are working to tap into the student loan system. While this may take away from the safeguards offered by Federal student loans, it will likely help to relieve economic strain. As a result, we are seeing more and more lenders looking for ways to attract student borrowers. The move for Wells Fargo to partner with Amazon is a strong move that will likely lead to quite a few loans sold. As a result, I do believe that this is a great partnership for all involved.
What This Partnership Means For Amazon Moving Forward
Will the student loan offering make Amazon massive amounts of money? Well, that is yet to be determined at this point. However, it will likely have massive positive implications for the company's stock price. At the end of the day, the fact that Amazon has made the decision to partner with Wells Fargo is a testament to the fact that Amazon will continue to look for ways to create added value for shareholders. At the end of the day, what more could investors want?