Up 27% in 1 Month, Amazon Is Now the Best-Performing "Magnificent Seven" Stock in 2026. 2 Reasons Why It's a Buy in May, and 1 Reason to Avoid.

In conscionable 1 month, Amazon (NASDAQ: AMZN) has gone from a double-digit antagonistic year-to-date (YTD) diminution to a 14.4% YTD summation arsenic of marketplace adjacent connected April 24. Amazon is present outperforming its "Magnificent Seven" peers Nvidia, Alphabet, Meta Platforms (NASDAQ: META), Apple, Microsoft, and Tesla, positive the Nasdaq Composite, and the S&P 500.

Even erstwhile factoring successful Amazon's stellar 2026 performance, it has inactive underperformed the S&P 500 implicit the past 5 years. But successful that period, Amazon has grown its net rapidly. In fact, Amazon is present consistently profitable, making it easier to measure it connected a price-to-earnings (P/E) ground alternatively than conscionable price-to-sales. It sports a 34 guardant P/E ratio, which is tenable for a high-growth person successful unreality computing infrastructure and online retail.

But Amazon's maturation could beryllium accelerating, which would marque the banal look ungraded inexpensive successful hindsight -- adjacent astatine an all-time high. Here are 2 reasons to bargain Amazon successful May, and 1 crushed to wait.

Reasons wherefore Amazon is simply a bargain

1. AI investments are paying disconnected

On April 24, Meta Platforms signed an statement with Amazon Web Services (AWS) to usage its Graviton5 cardinal processing units (CPUs) astatine scale. Meta plans to deploy tens of millions of Graviton cores to code the CPU needs of agentic artificial quality by improving processing powerfulness and efficiency. Meta could deploy adjacent much chips arsenic it expands its AI capabilities.

The Meta quality comes conscionable 4 days aft Anthropic -- the shaper of Claude ample connection models -- announced a much than $100 cardinal committedness implicit 10 years to AWS, including Graviton cores and Trainium chips. Trainium are exertion circumstantial integrated circuits custom-built for AI workloads.

These deals showcase Amazon's booming spot business. Graviton processors are built connected the AWS Nitro System, which includes specialized hardware and bundle for networking, storage, and security. Paired with Trainium, Amazon present has a highly integrated architecture built for AI -- which is appealing to endeavor customers.

Amazon's innovations successful customized AI chips and supporting infrastructure guarantee that it remains a person successful unreality computing by gathering cutting-edge AI factories and information centers and offering customized chips exclusively to AWS customers.

2. Enterprise and consumer-facing manufacture enactment

AWS is by acold Amazon's astir important conception and the large contributor to its existent and aboriginal net growth. But Amazon is truthful overmuch much than AWS -- it offers home and planetary online retail, advertising, subscription services, and more. These antithetic segments springiness Amazon aggregate levers to propulsion to unlock growth, nary substance the concern cycle.