so there's been a bit of a growing trend lately for some of these giant tech companies that have grown so insanely large to the point where they're now buying the stock of other companies themselves especially smaller ones with exciting technologies that they can benefit from through collaborations or even just to kind of help them grow larger too and benefit from a rising stock price as well now I recently showed you that with Nvidia but in today's video we're going to look at another tech giant in Amazon that's right amazon is actually investing in several stocks uh spending many millions of dollars even over a billion in one it's pretty crazy stuff and uh more specifically today we're going to run through the five largest of those investments that Amazon is making directly in other stocks i'm going to give you my opinion on each one of them and I'll even rank them from best to worst too based on that opinion and by the way most of these are actually stocks that I don't think I've ever even covered before on the channel so it's some very interesting picks here um it's going to be a lot of fun to look through them make sure that you hit that like button and subscribe if you haven't already thank you to everyone that does support the channel that way couldn't do this without you but with all of that said let's go ahead and just jump straight into this list now uh we'll be sorting these from smallest to largest holding uh you that Amazon is has in their portfolio and coming in at stock number one the smallest of the bunch well we have Marvel Technology ticker symbol MRVL which they now hold about $14 million of and is worth just over half a percent in the portfolio now if you're not familiar with this company they're actually a chip designer that's benefiting a lot especially recently from all the growth in artificial intelligence that's with especially their AI accelerators and networking chips that even some of the biggest tech giants use themselves like Microsoft Google Meta and of course Amazon who's also hired them to design their custom tranium to AI accelerators that achieved a cost savings of 30 to 40% over Nvidia's GPUs so it's very impressive what they're doing there and going forward the trend looks like it'll probably continue as these four giants alone are spending hundreds of billions of dollars on AI infrastructure which bodess very well for Marvel's addressable market that continues to grow by billions of dollars each year and thus is also resulting in some pretty nice growth rates for their financials with both sales and profits expected to soar in the coming years despite all of that growth though analysts and investors are worried about rising competition which I think is a fair argument considering how impressive the technology of other chip designers in the same space has become notably from companies like Broadcom and AI chip but even Nvidia in certain parts of the markets too if even one of those companies though manages to steal you know a big future contract away from Marvel uh especially with one of those big tech giants that I mentioned earlier then it could actually be devastating to their financials but because of this risk and a few other concerns the stock has actually crashed by over 40% from their recent highs leaving behind a pretty cheap valuation at a PEG ratio of not only less than one but it's also a whopping 67% lower than the sector median i think that's pretty attractive now if Marvel is able to fend off competition which is definitely possible considering how strong their and impressive their technologies are then this could be one heck of a high-flying growth stock long-term since it's a very rare combination that we don't often see of both kind of like a growth and a value type of stock combined into one so I really like the pickup here by Amazon in fact I would actually consider buying some myself if I didn't already own so many other chip stocks including by the way some direct competitors like Nvidia and Broadcom but for giving them a ranking here I'm going to go pretty high i want to put them at number two for now at least until I see what else is on this list now coming in at stock number two at least until we see what's on I've already seen the list but until we go through it together coming in at stock number two though we actually have another very interesting pickup here that I've never covered before on the channel and that is Astera Labs ticker symbol ALAB i just call them ALAB uh which Amazon currently holds over $16 million of at about 0.7% of the overall portfolio now this one just went public last year and it's been I don't know how else to describe it other than just like a very wavy type of stock with a couple huge clims couple big dips but overall it's actually still up about 34% all time now Amazon's investment into the company does make some perfect sense though as ALAB is another semiconductor company but one that focuses more specifically on AI connectivity helping data centers speed up their communications between chips basically eliminating the bottlenecks that you have between the various CPUs GPUs memory and other hardware within the data center itself something that is you know extremely important for AI systems to run faster and more efficiently the result has been though growing orders from not just cloud and AI giants like Amazon but even Nvidia Intel AMD and more which is also helping them turn a profit for the first time this year and going forward both sales and EPS are expected to rise by around 30% a year too on the other hand though competition is also fierce for this company with even Marvel being a direct competitor they offer some similar um solutions too who by the way I would also mention that Marvel carries a cheaper valuation especially on current pees but even on a forward-looking PEG ratio too that's not to say that Alabs is too expensive here it might be a fair value but because Marvel looks a little bit better just in my opinion I'm going to keep them at number two i'm going to put ALAB just right behind them at number three uh for now okay moving on here we have at stock number three we have Vital Farms ticker symbol VITL which Amazon now owns over 46 million of and is worth about 2% of their overall portfolio now I know what you're wondering why is Amazon investing in a farm company among these other you know chips and AI stocks and honestly it kind of caught me off guard a little bit too but the more that I looked into it the more it kind of started to make a lot of sense to me now this is a company that mostly just sells pasture-raised eggs and butter using a more ethical and transparent supply chain and you might have purchased their eggs and butter yourself from your local Sprouts or Whole Foods too i've actually had them a few times myself and when it comes to Amazon investing in them well you have to remember that Amazon actually acquired Whole Foods back in 2017 so by now investing in Vital Farms too becoming essentially part owner well Amazon is pretty much I would say kind of securing that reliable supply of high quality produce and you know over time they can even help them scale up using their gigantic expertise in logistics right like nobody does it better in logistics than Amazon so I mean by that logic it it it makes almost as much sense as you know investing in smaller chip companies to support their cloud server and AI businesses too all of these are kind of strategic investments and partnerships going on here that can actually help Amazon as well and by the way some have even speculated that Vital themselves could actually be an acquisition target for Amazon down the road too which wouldn't really surprise me with you know any of these companies really i could actually see them um wanting to to get closer to them you know as they're investing in them they're forming stronger partnerships you might start to see that they have a lot of future potential and you might just want to flat out acquire them before they grow too much larger than they they already are right now with all of that said though stock-wise Vital has been uh pretty much flat since IPOing in 2020 despite what has actually been some pretty consistent growth uh at least on the top line with last year for example seen not only a 28% surge in sales but even a double up on their profits too as they've now started to become profitable and uh they've started to run a lot leaner going forward now that that bottom line uh growth is not going to stay that high but just the point is that now they're improving on that on that side now I suppose the biggest concern moving forward though would just be kind of the lack of diversity away from you know just really selling eggs and butter which may be the reason why their revenue growth rates are also now falling year after year with still a pretty rich valuation despite that that is uh 70% more expensive than the sector at least on adjusted forward P basis now that's a tough pill to swallow for uh really any company but again especially for one that just sells eggs and butter uh that doesn't mean that it's a bad stock or a company i actually think that they're doing a phenomenal job within the constraints that they have but it's just not as exciting of a company as really any of the other ones that we've mentioned so far and because of that I'm just going to have to place them in last place for now uh even though I do like the company all right guys that's uh three down and we still have two more to go that's going to be the two largest investments for Amazon here so it's going to get a little more interesting coming in at stock number four though we actually have their newest pickup uh and that is an Advanced Micro Devices uh what we refer to as their ticker symbol AMD which Amazon just recently purchased over $84 million of last quarter bringing the stake up to about $3.5% of the portfolio and it's already you know their second largest holding now for this one I actually do really like it a lot amd I've always felt is that kind of perfect perfect um I would say alternative uh option in the market really to Intel for CPUs and Nvidia for GPUs selling what are still some very powerful and comparable chips but at much lower prices and that's really helped them steal market share along the way which is exactly what we've been seeing last year for example Nvidia's H100 AI GPUs were costing four times the amount of AMD's competing MI300X chips Uh now obviously Nvidia is always going to be the better um option for people that want the best performance but because of that dramatic difference in price and when there's just so much demand across the board for AI it's obviously going to lead to some growth for AMD and again that's exactly what we saw last year um it helped boost their data center revenues and profits by a whopping 94% and 175% respectively that's a huge deal because it's by far their largest segment now the second largest segment is their client business but that also soared by 52% and over 2,000% um on the bottom line respectively there and although gaming and embedded saw declines there's enough positive momentum here especially with the Ryzen AI that we really should still easily see some record high revenue and profits down the line coming in future years it's exactly what analysts are projecting and yet because of a recent dip of almost 40% coupled with their again high growth rates well their PEG ratio is actually 28% cheaper than the sector that's very attractive and look personally I used to own AMD stock which I later sold for a huge profit myself and I ended up using that money to invest in Nvidia instead bought a ton of that but once again I find myself tempted to jump back into AMD stock now that it's trading so low um I haven't done that yet i'm heavily considering it but regardless it's going to get the highest ranking here of number one because uh I just think it's looking very attractive at the moment okay finally though that's going to leave us with the fifth largest the fifth and the the number one largest holding uh we have Rivian ticker symbol RIVN which is the only stock that Amazon owns over a billion dollars of at a whopping 81% of the overall portfolio but for this one you know surprisingly I'm actually not a very big fan of it now don't get me wrong for Amazon themselves I think it makes perfect sense as they continue to build out a massive fleet of electric vehicles that are directly supplied by Rivian but as a standalone company apart from having you know the backing of Amazon I just feel like there's not a whole lot going on here or to really get too excited about now I think their trucks and SUVs are impressive but at current prices north of $80,000 on average I just think that they are way out of reach for the mass consumer market now a couple positive notes are that they are planning to release a cheaper EV next year and they've also ended exclusivity with Amazon on their electric vans which you know opens up the door for them to uh sell basically fleets um to other big companies but we still have to kind of wait and see how successful these moves will be in the future similarly they've also worked on autonomous driving technology but there too I just don't think it'll ever be as strong or successful as what Google Tesla Nvidia or even BYU is already doing and all four of those stocks I happen to already own myself plus their financials are not even that impressive with still giant losses despite many years of being in operation now on the bright side the stock has at least fallen by almost 90% because of all of this but even then their price to sales ratio is still 250% more expensive than the sector again I understand why Amazon owns it and even if smaller investors have it too I think there's you know a decent chance that it climbs higher longer term because it's already taken such a giant beating uh you know ever since IPO and especially with Amazon's help and if they remain partners even after ending that exclusivity stuff but apart from that I just think there's better options out there and I even see some better metrics and more future growth potential I would say too from the other stocks on this list so I'm actually going to give them the last place ranking of number five but hey that's just my opinion i would love to hear what you guys think about all of these down below overall I think there's some very interesting stocks here a little too speculative for my taste overall but at least you know AMD I'm a very big fan of and like I said all of the holdings I think make perfect sense from a partnership perspective for Amazon too but hey let me know if you own any of these stocks yourself or if you agree or disagree with my rankings on them i'd love to hear your thoughts on that too but hey either way I hope you enjoyed the video thanks again for stopping by my friends i hope that you're all doing well out there and I will catch you in the next one all right take care everybody bye-bye [Music]