Amazon's Current Valuation Presents Attractive Entry Point: Analyst
Amazon.com Inc. (NASDAQ: AMZN ) is heading into its third-quarter report with investors weighing strong Amazon Web Services expectations against pressure from higher AI spending, data-center investment and a weaker broader market setup. Amazon shares fell nearly half a percent in Thursday trading as risk appetite weakened. Nasdaq futures dropped almost 1%, while S&P 500 futures declined 0.39%. AWS Growth Sets a High Bar BNP Paribas analyst Nick Jones expects Amazon to post broad-based strength, led by continued momentum at AWS. Jones rates Amazon Outperform with a $355 price forecast, implying 39% upside from the cited $256.30 share price. He believes investors are looking for AWS revenue growth of 43% to 45%, well above the 38% consensus estimate. Jones also sees operating income closer to $28 billion, compared with the $25.9 billion consensus. Retail Business Tracks Near Expectations Jones expects Amazon's first-party and third-party retail revenue to remain roughly in line with consensus. Online stores and third-party seller services are tracking toward about 5% year-over-year growth. Fourth-Quarter Hurdle Remains High For the fourth quarter, Jones believes investors want the hi
com Inc. (NASDAQ: AMZN ) is heading into its third-quarter report with investors weighing strong Amazon Web Services expectations against pressure from higher AI spending, data-center investment and a weaker broader market setup. Amazon shares fell nearly half a percent in Thursday trading as risk appetite weakened. 39%.
AWS Growth Sets a High Bar BNP Paribas analyst Nick Jones expects Amazon to post broad-based strength, led by continued momentum at AWS. 30 share price. He believes investors are looking for AWS revenue growth of 43% to 45%, well above the 38% consensus estimate. 9 billion consensus.
Retail Business Tracks Near Expectations Jones expects Amazon's first-party and third-party retail revenue to remain roughly in line with consensus. Online stores and third-party seller services are tracking toward about 5% year-over-year growth. Fourth-Quarter Hurdle Remains High For the fourth quarter, Jones believes investors want the high end of Amazon's guidance to reach $247 billion in revenue and $35 billion in operating income. Those figures would top consensus estimates of $244 billion in revenue and $33 billion in operating income.
Jones also expects Amazon to raise its 2026 capital spending outlook by $5 billion to $10 billion as the company prepares for elevated investment in 2027. Data-Center Returns Stay in Focus Jones said investors remain focused on margins and returns from Amazon's data-center investments as spending stays elevated. Despite those concerns, he continues to view Amazon's current valuation as an attractive entry point. See More: Top Value Stocks Earnings and Analyst Outlook Amazon's next earnings report is estimated for Oct.
29, 2026. 95 per share, unchanged from a year earlier. 17 billion. 9.
Amazon carries a consensus Buy rating, with an average price forecast of $335. Recent analyst actions include: Tigress Financial: Maintained Buy and raised its price forecast to $385 on Oct. 6. TD Cowen: Maintained Buy and a $350 price forecast on Oct.
5. Rosenblatt: Maintained Buy and raised its price forecast to $360 on Sept. 30. 78% weighting.
71% weighting. 76% weighting. Changes in investor demand for these products can influence trading activity in Amazon shares, although the impact depends on fund flows and portfolio rebalancing. 92 at the time of publication on Thursday, according to Pro data.
Image via Shutterstock Read Also: Amazon AI Boom: Analysts See AWS, AI Agents Driving Bigger Growth