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Stock Analysis & ValuationLeverage Shares 1x Amazon ETP (AMZ1.L)

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£6.10
Sector Valuation Confidence Level
High
Valuation methodValue, £Upside, %
Artificial intelligence (AI)n/an/a
Intrinsic value (DCF)n/a
Graham-Dodd Methodn/a
Graham Formulan/a

Strategic Investment Analysis

Company Overview

LEVERAGE SHARES PUBLIC LIMITED offers the LS 1x Amazon Tracker ETP, an exchange-traded product designed to provide 1:1 exposure to the performance of Amazon.com, Inc. (AMZN) while deducting a management fee. As part of the Financial Services sector and specifically the Asset Management industry, this ETP caters to investors seeking direct, unleveraged exposure to Amazon's stock performance without the complexities of direct equity ownership. Headquartered in Ireland and listed on the London Stock Exchange (LSE), the product is structured to mirror Amazon's price movements, making it an efficient tool for both retail and institutional investors looking to gain targeted exposure to one of the world's largest e-commerce and cloud computing giants. The ETP's structure is particularly appealing for those who prefer a straightforward, fee-transparent investment vehicle over more complex derivatives or direct stock purchases.

Investment Summary

The LS 1x Amazon Tracker ETP (AMZ1.L) provides a cost-efficient way to gain direct exposure to Amazon's stock performance, making it attractive for investors bullish on Amazon's long-term growth in e-commerce, cloud computing, and digital advertising. However, as a single-stock ETP, it carries concentrated risk tied to Amazon's performance, lacking diversification benefits. The product's low beta (0.38) suggests lower volatility relative to the broader market, which may appeal to risk-averse investors. Key risks include tracking error, liquidity constraints (given the lack of disclosed market cap and revenue data), and reliance on Amazon's corporate performance. The absence of dividends and negative operating cash flow (-€141.4M) indicate this is purely a capital appreciation play, suitable for tactical rather than long-term income-focused portfolios.

Competitive Analysis

LEVERAGE SHARES' LS 1x Amazon Tracker ETP competes in the niche market of single-stock ETPs, differentiating itself by offering unleveraged, fee-transparent exposure to Amazon. Unlike leveraged or inverse products, this ETP avoids the decay effects associated with daily resets, making it more suitable for buy-and-hold investors. Its primary competitive advantage lies in its simplicity and direct tracking mechanism, appealing to those who want Amazon exposure without dealing with US-listed ADRs or currency conversion costs (though EUR-denominated trading introduces FX risk for non-EUR investors). However, the product lacks the diversification benefits of broader tech or e-commerce ETFs. Its competitive positioning is weakened by the widespread availability of Amazon shares through conventional brokers and the dominance of multi-asset ETFs that include Amazon as a top holding. The ETP's success hinges on Amazon's continued market leadership and the demand for single-stock thematic products in Europe.

Major Competitors

  • Amazon.com, Inc. (AMZN): The direct equity (AMZN) offers full shareholder rights, including voting and dividends, which the ETP does not. However, AMZN requires dealing with US market hours and potential FX costs for EUR-based investors. Amazon's sheer scale and diversification across e-commerce, AWS, and advertising make it a lower-risk standalone investment than a single-stock ETP tracking it.
  • Invesco EQQQ NASDAQ-100 UCITS ETF (EQQQ): This ETF provides diversified exposure to Nasdaq-100, where Amazon is a top-5 holding. It offers broader market participation while still maintaining significant Amazon exposure (~8-10% weight). Better suited for investors seeking tech sector diversification, though it dilutes pure Amazon exposure.
  • iShares NASDAQ 100 UCITS ETF (SXRV): Similar to EQQQ, this ETF tracks the Nasdaq-100 with Amazon as a major component. Its lower expense ratio (0.33%) may appeal more than a single-stock ETP's fee structure. However, it lacks the targeted Amazon focus that AMZ1.L provides.
  • WisdomTree Cloud Computing UCITS ETF (3APS): This thematic ETF includes Amazon (via AWS exposure) among cloud-focused stocks. Appeals to investors targeting Amazon's high-growth cloud segment specifically, but with added diversification. May attract similar investors seeking tech growth without single-stock risk.
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