Amazon (AMZN -0.23%) stock returned 910% during the last decade, growing at a pace that would have turned $50,000 into more than $500,000. Wall Street remains overwhelmingly bullish on the company. Among 71 analysts, 97% have a buy rating on the stock, and the median 12-month target price of $240 per share implies 9% upside from its current share price of $220.

Can Amazon stock turn $50,000 into $1 million in the next 10 years?

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Amazon is a major player in three growing markets

Amazon has a strong position in three large industries -- e-commerce, digital advertising, and cloud computing. The company is also leaning on artificial intelligence (AI) across all three business units to accelerate revenue growth and widen profit margins, as detailed below:

• E-commerce: Amazon runs the largest e-commerce marketplace in the world, in terms of revenue, and the most popular, in terms of traffic. Even more impressive, the company is still gaining share. Amazon has built more than 1,000 generative AI applications to make its retail business more efficient, including tools to improve inventory placement, demand forecasting, and developer productivity. It's also using generative AI to let human workers engage warehouse robots in natural language.
• Digital advertising: Amazon has as a distinct advantage in advertising not only because it draws so many shoppers to its marketplace, but also because it has troves of consumer data to target advertising. That advantage has helped it become the third-largest ad tech company in the world. Amazon has added AI tools that help brands plan and optimize ad campaigns, as well as generative AI tools that let brands create images and videos.
• Cloud computing: Amazon Web Services (AWS) is the largest public cloud platform in terms of infrastructure and platform spending. That means the company is already well-positioned to monetize demand for AI infrastructure, but AWS has further cemented its status as a go-to cloud services provider by designing custom chips for AI training and inference. The company says those chips deliver better price performance than leading graphics processing units (GPUs).

Through 2030, retail e-commerce sales are forecast to increase at 11% annually, ad tech spending is projected to increase at 14% annually, and cloud computing sales are expected to increase at 20.4% annually, according to Grand View Research. That means Amazon can achieve double-digit annual revenue growth through the end of the decade if it merely maintains its market share in those industries.

Amazon stock is unlikely to turn $50,000 into $1 million in the next decade

Amazon would have to increase 20 times in value (i.e., a 1,900% return) to turn $50,000 into $1 million. That is theoretically possible over a decade, but such performance is exceedingly rare. Only five companies in the S&P 500 achieved 20-fold returns during the last 10 years, as listed below:

• Nvidia: +29,950%
• Advanced Micro Devices: +5,520%
• Axon Enterprise: +2,230%
• Texas Pacific Land: +2,070%
• Fair Isaac: +1,910%

I doubt Amazon shares will advance 1,900% over the next decade. It's already a $2.3 trillion company, and multiplying its current market capitalization by 20 would bring its valuation to $46 trillion.

That's nearly what the entire S&P 500 is worth today. It seems unlikely Amazon alone will be worth that much in 10 years. However, the stock is still a smart long-term investment.

Why Amazon stock is a buy at its current price

Some Wall Street analysts have lowered their forward earnings forecasts based on the idea that tariffs will hurt sales or margins. The consensus currently says Amazon's adjusted earnings will increase at 10% annually through 2026. That makes the current valuation of 36 times earnings look expensive, but I think Wall Street is too pessimistic.

Amazon beat the consensus by an average of 22% over the last six quarters, and I think the company will continue to top expectations due to its strength in three growing markets and its capacity for innovation in adjacent areas. For instance, Amazon is reportedly preparing to test humanoid robots for package delivery, and its autonomous driving subsidiary Zoox is set to launch robotaxis in at least one U.S. city this year.