A roster of billionaire fund managers has spent the past year quietly turning Amazon into their largest or second-largest position, betting that the market has mispriced the company’s AI exposure. David Tepper’s Appaloosa Management and Seth Klarman’s Baupost Group now count Amazon as their single biggest holding. Bill Ackman’s Pershing Square built a $2.4 billion stake from scratch over the last twelve months, making it the fund’s second-largest position. Sanders Capital doubled its stake in the first quarter of 2026 to 29.8 million shares worth about $6.2 billion, slotting Amazon in behind only Taiwan Semiconductor and Alphabet.
The performance gap that drew them in
While nearly every other AI-adjacent megacap has surged over the past twelve months, Nvidia up 35%, Intel up 496%, Micron up 719%, Amazon’s stock has risen 10.1% over the same period and just 3.4% year to date. The divergence matters because Amazon Web Services, the cloud division that rents the compute capacity AI models require, posted 28% revenue growth in the first quarter of 2026 to $37.6 billion, what CEO Andy Jassy called its fastest expansion in fifteen quarters. Overall revenue grew 17% to $181.5 billion with operating income of $23.9 billion. For value-oriented managers, a business accelerating while its share price stagnates is the textbook setup.
The sum-of-the-parts arithmetic
Charles Lemonides of ValueWorks, who also holds the stock, frames it as a simple partition: AWS is worth roughly half of Amazon’s $2.5 trillion market capitalization, the retail operation the other half, and the advertising, media and streaming businesses come along for free. The contracted revenue backlog stood at $364 billion as of March 31, a figure that excludes Anthropic’s commitment to spend more than $100 billion on AWS over the next decade. Amazon has already invested $8 billion in Anthropic and agreed to put in up to $25 billion more.
Leadership continuity as a factor
Lemonides argues the case has strengthened over the past year because Amazon kept executing while the share price barely moved. He points to Jassy’s team navigating turbulent conditions without turnover, leaving the organization “firing on all cylinders.” The managers’ convergence is not a coordinated trade; it is independent arrival at the same arithmetic. Whether the market eventually closes the gap or finds a new reason to keep it open is the only question that matters.