Why Amazon and Hims & Hers Stand Out as Strategic Investments in 2026

Market Backdrop: Finding Value Beyond AI Hype

As 2025 draws to a close, equity markets have delivered solid returns with the S&P 500 gaining 14% and the tech-heavy Nasdaq Composite surging 18%, fueled primarily by the generative AI narrative. However, the rapid maturation of this sector presents a strategic challenge: pure-play AI hardware manufacturers face valuation risks, while companies with diversified AI exposure and other growth vectors present more balanced opportunities.

For investors contemplating capital deployment in 2026, the question isn’t whether to own AI exposure—it’s how to own it intelligently. Two compelling candidates emerge when examining the landscape: Amazon (NASDAQ: AMZN) and Hims & Hers Health (NYSE: HIMS), each offering distinct value propositions beyond the headline AI trend.

Amazon: The Diversified AI Play

Amazon’s position in the AI infrastructure ecosystem is multifaceted, distinguishing it from single-dimensional beneficiaries. The company holds a strategic stake in Anthropic, a leading artificial intelligence firm specializing in large language models. Anthropic’s market performance underscores the quality of this investment: the company commands 32% market share in U.S. enterprise LLMs compared to OpenAI’s 25%, primarily due to its emphasis on reliability and security.

The dual benefit for Amazon is significant. First, as an equity holder, Amazon participates directly in Anthropic’s value creation as the company scales. Second, Anthropic relies on Amazon Web Services (AWS) as its primary cloud infrastructure provider, generating recurring revenue streams from model development, training, and deployment activities.

Beyond its external AI ventures, Amazon is leveraging generative AI to reshape its own operational efficiency. CEO Andy Jassy communicated in mid-2025 that AI-driven automation could substantially reduce corporate overhead through workforce optimization. The subsequent October layoffs affecting 14,000 positions represented potential cost savings in the billions—a tangible demonstration of how technology can enhance profitability. While this approach has earned Amazon criticism as the poster child for AI-driven job cuts, the reputational considerations require ongoing monitoring. Jassy’s leadership during this transition underscores his focus on long-term shareholder value despite near-term perception challenges.

What distinguishes Amazon is its structural diversification. Unlike companies entirely dependent on a single AI narrative, Amazon combines infrastructure revenue, retail operations, cloud services, and venture returns—reducing idiosyncratic risk while maintaining substantial upside to AI adoption.

Hims & Hers Health: The Overlooked Growth Story

While market attention gravitates toward AI, a parallel structural transformation is reshaping healthcare delivery. Telehealth represents a generational shift in how consumers access medical services, with analyst projections suggesting compound annual growth rates of 24% through 2030 across virtual medical infrastructure.

Hims & Hers Health has positioned itself uniquely within this expanding market by transcending the traditional telemedicine model. Rather than simply offering remote consultations, the company has constructed an experience-focused platform addressing personal health concerns—sexual wellness, hair restoration, weight management—that patients might hesitate to discuss in traditional clinical settings. This positioning particularly resonates with Gen Z and millennial demographics, who increasingly prefer digital-first health solutions.

The operational metrics validate this strategy. Third-quarter revenue reached $600 million, representing a striking 49% year-over-year increase. More importantly, Hims is evolving into a platform aggregator; individual patients increasingly utilize multiple services within the ecosystem—combining mental health support, sexual health treatment, and weight management—creating switching costs and higher lifetime value.

The profitability profile deserves context. Third-quarter operating income of $11.8 million reflects a 50% decline, which might concern value-oriented investors. However, management’s strategic investment in brand building and market share expansion takes precedence over near-term earnings maximization. This capital allocation philosophy typically generates superior long-term returns than premature profit optimization.

The Investment Thesis: Dual Exposure Strategy

Combining these positions addresses the core investment challenge of 2026: maintaining AI exposure while diversifying into adjacent growth vectors. Amazon provides infrastructure-based AI participation with inherent business diversification, while Hims offers exposure to healthcare digitalization—a structural trend independent of AI hype cycles.

The combined exposure creates a portfolio positioned for both the continuation of AI-driven transformation and the parallel adoption of digital-first service models reshaping consumer behavior.