Skip to main content

Amazon shares could rally near 26 percent after earnings beat, analysts say after bullish upgrades




Amazon.com founder and CEO Jeff Bezos
Amazon.com founder and CEO Jeff Bezos
Amazon's stock received a slew of upgrades from Wall Street analysts on Friday after delivering market-beating earnings.
On Thursday, the e-commerce giant reported fourth quarter revenues that beat expectations with the Amazon Web Services (AWS) cloud division helping to propel numbers.
Amazon shares closed at $1,390 on Thursday, but after hours shares popped over 5 percent.
A number of analysts raised their price target for Amazon shares. Here are some of the biggest moves:
  • Morgan Stanley raised its target to $1,500 from $1,400
  • Barclays upped its price target to $1,580 from $1,210
  • Credit Suisse raised its price target to $1,750 from $1,410
  • Mizuho raised its price target to $1,700 from $1,300
  • J.P. Morgan raised its price target to $1,650 from $1,385
  • Bank of America Merrill Lynch raised its price target to $1,650 from $1,460.
Amazon forecast that its operating income for the first quarter of 2018 would be between $300 million to $1 billion, below the $1.5 billion street consensus, likely indicating heavier investments going forward. But this did not worry analysts.
Is Amazon overvalued?  
"While profitability is taking a step back, we believe Amazon is once again investing ahead of growth in commerce and voice search," Mizuho said in a note announcing its price target upgrade.
Credit Suisse's target price of $1,750 is the highest of the latest round of upgrades. If realized, it would represent a near 26 percent increase from Thursday's closing price of $1,390.
But Credit Suisse is not the most bullish analyst on the Street. Last month, D.A. Davidson increased its price target for Amazon shares to $1,800 from $1,500.
"We see two potential catalysts for shares over the next 12-month period: stronger-than-expected operating results from the company's cloud computing efforts, which we believe remains the primary driver of its share price and, due to its increasing mix of highly-profitable third-party sales (which surpassed 50 percent for the first time in 2Q17)," analyst Tom Forte wrote in a note to clients last month.
Amazon's cloud business continued to be its fastest-growing and most profitable in the fourth quarter. For the quarter, AWS sales jumped 45 percent year-on-year, while generating $1.3 billion in operating income, a whopping 64 percent share of Amazon's total operating income.
CEO Jeff Bezos also said Amazon would "double down" on its Alexa voice technology.
Analysts are extremely bullish on Amazon's stock in the long term, thanks to a number of factors.
"In a nutshell, Amazon remains one of our favorite secular tech growth stories for FY18... and these robust results and 2018 outlook support the Amazon consumer growth thesis, coupled by cloud strength on the AWS segment which is still in the early innings of playing out among enterprises globally on the secular cloud theme," Daniel Ives, head of technology research at GBH Insights, wrote in a note Thursday.

Labels:

Comments

Post a Comment

Popular posts from this blog

Who Is Zuleyka Rivera? 5 Things To Know About The ‘Despacito’ Actress

With ‘Despacito’ up for Record of the Year at the 2018 Grammy Awards, here’s everything you need to know about the music video’s actress — Zuleyka Rivera! 1. She’s a renowned beauty queen.  Not only did she claim the Miss Universe Puerto Rico title, Zuleyka eventually took the top prize and was later crowned Miss Universe in 2006. 2. After her huge Miss Universe win, she studied acting and eventually became a TV star.  She now lives in Miami where she’s frequently a special guest or a host on shows like  Un Nuevo Dia  on Telemundo and  Despierta America  on Univision. Before that, she became a breakout star by appearing on several Televisa soap operas in Mexico. 3. In addition to modeling, she also owns her own clothing line.  On top of running her own teen-ware clothing collection, she also has three fragrance lines called the Karisma, Zuleyka and Zuleyka 2010. If that wasn’t impressive enough, she also started an amazing swims...
Post a Comment
Read more

Frank Ocean new album: How to listen and stream Boys Don’t Cry when it drops

After two missed release dates a year apart and a confusing decoy of a “live stream” video, Frank Ocean is set to finally release his second album,  Boys Don’t Cry , on Friday 5 August. It will be launched through an exclusive deal with Apple Music, according to the  New York Times , who cite a ‘person with knowledge of the release plans’. If indeed this is the case (and it would make sense, that live stream has an Apple watermark), it means you’ll need to sign up for Apple Music to listen to the  Channel Orange  follow-up, which costs £9.99 a month (£4.99 for students through Apple’s UNiDAYS promotion). You might want to turn off auto-renewal off though (Apple Music app > profile icon > View Apple ID. > Subscriptions > Manage > switch Auto-Renewal off), if you’re the kind of person who, like me, is liable to forget that you’ve signed up for the service indefinitely. Beyond Apple Music...
Post a Comment
Read more

Celine Dion Gives a Tearful Interview After Her 2016 Billboard Music Awards Performance: "Music Is Extremely Therapeutic"

As  Céline Dion  sang, "The Show Must Go On"—and go on it did. At the  2016 Billboard Music Awards  Sunday, the 48-year-old diva brought down the house with her cover of  Queen 's "The Show Must Go On." Celine received a standing ovation inside the T-Mobile Arena in Las Vegas, and to top it off, she received the ICON Award from her 15-year-old son,  René-Charles Angélil . A surprised and emotional Celine thanked her fans, family, children, and "most importantly," her late husband  René Angélil , "who I know will continue to watch over me from above." Celine added, "René, this one's for you. The show must go on." Celine then made her way backstage to do interviews, but paused to watch  Madonna  and  Stevie Wonder 's tribute to  Prince . She danced, sang along and snapped her fingers as they performed"Nothing Compares 2 U" (which Prince wrote  Sinéad O'Connor ) and "Purple Rain." Afterward, C...
Post a Comment
Read more