Amazon Stuck in a Rut: Trader Sees No Catalysts Until Next Earnings Report
Amazon's stock price has been stuck in a rut since its earnings report on July 30th, and trader Mike Khouw is betting it will remain there until late September. With Amazon currently holding the top spot on Fortune magazine's list of the 500 largest US corporations by revenue, its impressive growth rate may not be enough to boost investor confidence.
The company's estimated FY2026 revenues are over $828 billion, accounting for more than 2.5% of the US GDP and a 15.5% year-over-year growth. Despite this solid performance, Amazon trades at a relatively low multiple of just 22x FY2027 adjusted EPS estimates of $12.35 per share.
Khouw suggests that investors consider a 'jade lizard' strategy, which involves selling short puts and calls while buying higher-strike long calls as a hedge. This bet would be on Amazon's stock price staying range-bound between now and its next quarterly earnings report, with potential risks capped by the higher strike of $320.