Amazon.com, Inc. (NASDAQ:AMZN) recently announced its plans of buying Twitch for $970 million in cash. Twitch is a website that allows people to watch live gameplay i.e. players can log in to the site to watch others players play the video games live. Many on the Street are skeptical about where Twitch will under Amazon.com, Inc. (NASDAQ:AMZN)’s portfolio of businesses, but Jim Cramer isn’t so skeptical. He discussed why he likes the deal on CNBC recently.
“[…] This is an obsession for games, that’s why I felt Xbox is good, that’s why I think there is so much value in Microsoft, I like this deal because anything that focuses on this generation, the generation that is not going to Burger King does love gaming. It’s what they do, it’s I think a little limited, but it’s what they do,” Cramer said.
Cramer mentioned that while Google Inc (NASDAQ:GOOGL) was talking about acquiring Twitch, people were not in favor of that, because according to them Google had earnings. According to Cramer Amazon.com, Inc. (NASDAQ:AMZN) doesn’t faces that kind of skepticism from street as the company has not posted any profit till now, as Amazon.com, Inc. (NASDAQ:AMZN) re-invests whatever it earns back into the business . He also revealed that people are now again getting excited in Amazon.com, Inc. (NASDAQ:AMZN)’s stock.
According to Cramer, there is no difference between companies like Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX) or even Tesla Motors Inc (NASDAQ:TSLA), as all these companies lack on profitability, but are doing great in terms of growth and targeting their desired audiences. Cramer believes that just like Netflix and Tesla Motors have targeted a niche audience or ‘fan base’, Amazon.com, Inc. (NASDAQ:AMZN) is trying to do the same thing with its acquisition of twitch. He finds that it is ok if people own any one of these stocks.
As of June 30, 2014, Ken Fisher‘s Fisher Asset Management owns over 2.4 million shares in Amazon.com, Inc. (NASDAQ:AMZN).