Amazon Stock Soars as Analysts Maintain Buy Ratings and Raise Price Targets

Analyst reboots Amazon price target ahead of earnings

Amazon (AMZN) recently wrapped up its Prime Day sale extravaganza and the internet retail and entertainment giant said it was a humdinger. Related: Alphabet earnings up next with Google parent's AI costs in focus In fact, Amazon said this was biggest Prime Day shopping event ever, with record sales and more items sold during the two-day event than any previous Prime Day. "Prime Day 2024 was a huge success thanks to the millions of Prime members globally who turned to Amazon for fantastic deals, and our much-appreciated employees, delivery partners, and sellers around the world who helped bring the event to life for customers," Doug Herrington, CEO of Worldwide Amazon Stores, said in a statement. It was also a good day for Rufus, Amazon's AI-powered conversational shopping assistant, which the company said "helped millions of customers shop Amazon's wide selection quickly and easily." Amazon introduced Rufus in February, saying that "we believe generative AI is going to change virtually all customer experiences that we know." "With Rufus, customers are now able to shop alongside a generative AI-powered expert that knows Amazon's selection inside and out, and can bring it all together with information from across the web to help them make more informed purchase decisions," the company said. Amazon's annual summer savings event has been an ongoing promotion for about a decade. Analyst cites strong 'Back to School' spending TheStreet Pro's Chris Versace noted that, according to Adobe Analytics, U.S. consumers spent $14.2 billion during Prime Day 2024, up almost 12% compared with $12.7 billion a year ago and surpassing Adobe's expectation of $14 billion. "As we suspected, one area of spending strength was Back to School, which soared 216% compared to last year, Versace said. "Meanwhile, Electronics was up 61%, with Adobe calling out Apple (AAPL) , as a beneficiary with overall phone sales rising 18% year over year. Apparel and Furniture were also named as well-performing categories." Related: Analysts reboot CrowdStrike stock price target following global outage However, he added that Prime Day accounts for only about 1% of Amazon's sales in the current quarter, and "as such, we should not read too much into the findings, and also be mindful that the event will goose the July Retail Sales report." "It should also pull forward Back-to-School spending that we tend to see in August, resulting in a sequentially softer headline retail figure in the August Retail Sales report," Versace said. JMP Securities said that Amazon's annual Prime Day saw another year of record Gross Merchandise Value, despite persisting consumer headwinds. GMV, which represents the total value of goods or services sold within a given period, grew 11% year-over-year to 12.7%, according to Adobe, and the firm said that it was impressed with the positive trends given the current macro backdrop. JMP made no change to its outperform rating and $225 price target and expects Amazon to hold another Early Access Sale event later this year, though no details have been released. Amazon, which is scheduled to report second-quarter results on August 1, posted better-than-expected earnings and revenue for the first quarter. Advertising revenue grew 24% in the first quarter, surpassing retail and cloud computing. "The strength in advertising was primarily driven by sponsored products, supported by continued improvements in relevancy and measurement capabilities for advertisers," CEO Andy Jassy told analysts during the company's earnings call. "We still see significant opportunity ahead in our sponsored products, as well as areas where we're just getting started like Prime Video ads." Analyst bullish on advertising growth Prime Video ads, he added, "offers brands value as we can better link the impact of streaming TV advertising to business outcomes like product sales or subscription sign-ups, whether the brands sell on Amazon or not." "It's very early for streaming TV ads but we're encouraged by the early response," Jassy said. More tech stock news: Analysts have been adjusting their price targets for Amazon ahead of the earnings report. Loop Capital kept a buy rating and $225 price target on Amazon, but noted that the firm is increasingly bullish on the growth runway for Amazon's advertising business that it sees extending well beyond sponsored listings into CTV, audio ads and across the open internet. The company offers fundamental advantages, especially with unparalleled shopper data, while changes in the ad ecosystem are amplifying its differentiation, and Amazon Ads could achieve $150 billion in revenue before the end of the decade from $47 billion last year, the firm said. Truist raised the firm's price target on Amazon to $230 from $220 and kept a buy rating on the shares. The firm anticipates an earnings beat, citing its Truist Card Data that tracks North America sales, positive checks into the ads business, and expectations for further growth acceleration at Amazon Web Services, the company's cloud-computing subsidiary. Despite the backdrop of a "weakening consumer" Amazon continues to gain share of global e-commerce and improve its value proposition to both merchants and consumers, Truist said. Morgan Stanley raised the firm's price target on Amazon to $240 from $220 and kept an overweight rating on the shares. The firm previewed second-quarter earnings per share for the North American Internet group, stating that Amazon remains its top mega cap pick. Related: Veteran fund manager sees world of pain coming for stocks

Brokerage firm raises Amazon stock target, maintains buy rating By Investing.com

On Monday, Truist Securities increased its price target on shares of Amazon.com (NASDAQ:AMZN) to $230 from the previous target of $220, while keeping a Buy rating on the stock. The firm's optimism is fueled by several positive indicators ahead of Amazon's second-quarter earnings report, scheduled for August 1, 2024. The adjustment in the price target comes as Truist Securities anticipates Amazon to surpass expectations in its upcoming earnings announcement. This forecast is based on the analysis of North American sales through Truist Card Data, insights into the company's advertising business, and expectations for continued growth in Amazon Web Services (AWS). Moreover, the firm predicts improvements in unit economics and operational expense management, which are expected to lead to higher margins and profitability. Truist Securities highlights that despite a weakening consumer environment, Amazon is continuing to capture a larger share of the global e-commerce market and enhance its offerings to both merchants and consumers. The firm suggests that Amazon's ability to expand its market share is a testament to its compelling value proposition. The analyst from Truist Securities believes that Amazon's growth is driven by multiple factors. This includes the robust performance of AWS and the company's advertising segment, which are both expected to contribute significantly to Amazon's overall growth trajectory. In summary, Truist Securities' revised price target reflects a bullish outlook on Amazon, based on strong sales data, positive business segment checks, and the potential for improved financial metrics. The firm's stance suggests confidence in Amazon's strategy and its ability to thrive amid broader economic challenges. In other recent news, Loop Capital maintains a Buy rating for Amazon, anticipating a significant expansion of Amazon's advertising business. The firm projects Amazon Ads could generate up to $150 billion in revenue by the end of the decade. Amazon's recent Prime Day event saw a record-setting $14.2 billion in online sales, marking an 11% increase from the prior year. This spending surge was largely driven by back-to-school purchases, which experienced a 216% increase compared to daily sales in June 2024. Financial services firm Needham has raised its price target on Amazon shares to $210 from $205, citing potential upside from its Generative AI initiatives and the estimated $46 billion value of Twitch, Amazon's live streaming platform. In labor news, the GMB union's bid for formal recognition at an Amazon warehouse in Coventry, England, was unsuccessful. This development comes amid a broader push by the newly elected Labour government in Britain to enhance workers' rights and empower unions. These are some of the recent developments involving Amazon. As Truist Securities updates its outlook on Amazon.com, real-time data from InvestingPro aligns with the firm's bullish stance. Amazon's market capitalization stands at an impressive $1.92 trillion, underscoring its massive scale and influence in the market. The company's P/E ratio, while high at 50.29, reflects the market's expectation of continued growth and profitability, a sentiment echoed in the analyst's report. Moreover, Amazon's revenue growth remains robust, with a notable 12.54% increase over the last twelve months as of Q1 2024, which may further support the firm's optimism regarding Amazon's upcoming earnings report. InvestingPro Tips highlight Amazon as a prominent player in the Broadline Retail industry, with cash flows that can sufficiently cover interest payments and a moderate level of debt. These factors contribute to the company's financial stability and ability to invest in growth areas like AWS and advertising. With analysts predicting profitability this year and a high return over the last decade, Amazon's financial health appears to be solid. For readers interested in a deeper analysis, there are additional InvestingPro Tips available that provide further insights into Amazon's financial metrics and market position. By using the coupon code PRONEWS24, readers can get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription to access these valuable tips and enhance their investment strategy.

Loop Capital maintains Amazon Buy rating, steady stock price target By Investing.com

On Monday, Loop Capital upheld its Buy rating for Amazon.com (NASDAQ:AMZN) shares with a steady price target of $225.00. The firm's positive stance is rooted in the anticipated expansion of Amazon's advertising business. According to Loop Capital, the potential for growth extends significantly beyond sponsored listings, encompassing Connected TV (CTV), audio advertisements, and broader presence across the open internet. The firm highlights Amazon's intrinsic advantages, particularly its access to unparalleled shopper data, as a key factor in its differentiation within the advertising ecosystem. These strengths are becoming increasingly pronounced due to ongoing changes within the advertising industry. Loop Capital projects that Amazon Ads could generate up to $150 billion in revenue by the end of the decade, a substantial increase from the $47 billion recorded last year. Loop Capital expresses confidence in Amazon's performance as the company approaches its earnings report, emphasizing that the core tenets of their investment thesis remain solid. They anticipate continued momentum for Amazon Web Services (AWS) and improvements in retail unit economics. This optimism persists despite a retail environment described as "softish," with the firm asserting that there is still considerable potential for growth. Loop Capital reiterates its Buy rating and $225 price target, signaling strong conviction in the stock's prospects. In other recent news, Amazon's Prime Day event saw a record-setting $14.2 billion in online sales, marking an 11% increase from the prior year's event. This spending surge was largely driven by back-to-school purchases, which experienced a 216% increase compared to daily sales in June 2024. Amazon reported that this year's Prime Day surpassed previous years in terms of both sales and the number of items sold, further solidifying the event's significance in the retail calendar. Meanwhile, financial services firm Needham raised its price target on Amazon shares to $210 from $205 while maintaining a Buy rating. This optimistic outlook is largely based on Amazon's potential upside from its Generative AI initiatives and the estimated $46 billion value of Twitch, Amazon's live streaming platform. In labor news, the GMB union's bid for formal recognition at an Amazon warehouse in Coventry, England, was unsuccessful. This development comes amid a broader push by the newly elected Labour government in Britain to enhance workers' rights and empower unions. These recent developments highlight Amazon's robust performance in the retail sector, its potential for growth in the tech industry, and its ongoing labor relations issues in the UK.