Investment firm TD Cowen has reiterated a bullish stance on Amazon (NASDAQ: AMZN) even as the stock faces short-term bearish pressure.
Specifically, the firm’s analyst John Blackledge assigned the stock a ‘Buy’ rating while maintaining a $350 price target, implying a potential upside of about 32% from Amazon’s press-time value of $264.
The updated outlook follows Amazon’s launch of Supply Chain Services, a logistics offering aimed at third-party businesses beyond the company’s online marketplace.
The analyst views the initiative as a significant expansion of Amazon’s logistics operations that could strengthen North American operating margins over the long term.
According to the note, Amazon’s growing logistics monetization strategy is expected to become an increasingly important earnings driver as the company opens its retail logistics network to merchants that do not sell directly on Amazon’s storefront.
Blackledge also highlighted a major shift in Amazon’s capital expenditure mix toward artificial intelligence infrastructure and cloud computing through Amazon Web Services.
To this end, TD Cowen expects AWS-related spending to continue rising sharply as the company accelerates investments tied to AI demand.
The firm noted that Amazon’s retail and other capital expenditures represented roughly 63% of total company capex in 2018 but are projected to decline to about 25% in 2025 and 16% in 2026. At the same time, AWS-related capex is forecast to grow from about $25 billion in 2023 to nearly $170 billion by 2026.
Wall Street bullish on AMZN stock price
Indeed, the TD Cowen outlook aligns with the broader sentiment on Wall Street regarding the American technology giant. Specifically, the stock has a consensus rating of ‘Strong Buy’ from 46 analysts tracked by TipRanks.
Among them, 45 recommend a buy rating, one suggests holding the stock, and none advise selling.
The average 12-month price target for Amazon stands at $318.23, implying a potential upside of 20.38% from the latest share price of $264.35. Analysts’ forecasts range from a high target of $370 to a low estimate of $250.
Despite the bullish outlook, the wide gap between the highest and lowest price targets indicates that analysts still expect some volatility in Amazon shares amid broader market and economic uncertainty.
