16 June 2017: Amazon buys Whole Foods
On June 16, 2017 Amazon agreed to buy Whole Foods for $13.7 billion, its biggest acquisition at the time. Shares of grocers like Kroger fell sharply that day as investors feared Amazon would do to groceries what it had done to bookstores. The disruption came more slowly than feared, but the deal gave Amazon hundreds of physical stores and a foothold in groceries.
The lesson: The market often prices disruption instantly, even though it usually takes years to arrive.
What it meant for investors
$1,000 in Amazon at the start of 2018 → $3,667 today, vs $2,519 in the S&P 500.
We start the clock at the start of 2018, the first year in our price data after the event. That is 3.7 times the money, and $1,148 more than a plain index fund made over the same years.
What Amazon teaches: Accounting losses are not the same as a bad business; Amazon reinvested its cash flow for years while short-term investors read thin profits as weakness.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2015 | $15.00 | $14,667 | $3,301 |
| 2018 | $60.00 | $3,667 | $2,519 |
| 2020 | $95.00 | $2,316 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought Amazon? Every starting year and the full story →
More Amazon history
- 2 February 2021: Jeff Bezos says he will step down as Amazon CEO
- 15 May 1997: Amazon goes public at $18 a share
- 5 July 1994: A bookstore called Cadabra
- 19 November 2007: Amazon launches the Kindle
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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