Phillip Securities upgraded Amazon (NASDAQ: AMZN) to “Buy” from “Accumulate” on Monday, November 2, raising its Amazon stock price target from $320 to $330.
The firm expressed confidence in the company’s cloud computing and artificial intelligence (AI) prospects, in particular Amazon Web Services (AWS).
At the same time, analyst Helena Wang raised the financial group’s fiscal 2027 revenue estimate for Amazon by 2% and adjusted the net income forecast by 3%, citing stronger growth in AWS.
Advertisement
Furthermore, the firm also lifted its fiscal 2027 capital expenditure estimate by 3%, as Amazon’s revenue increased 15% over the past year to approximately $797 billion, while return on equity reached 27%.
Overall, the new AMZN share price forecast implies 38% upside from the last closing price of $240.
Amazon stock price target increased on AI potential
As mentioned, Phillip Securities highlighted Amazon’s positioning in the AI market, in particular, its model-agnostic strategy and full-stack capabilities, including custom-designed chips and major partnerships.
However, Wang also acknowledged that Amazon’s aggressive capital expenditure plans are putting pressure on free cash flow, even if the firm believes strong demand visibility justifies the infrastructure investments.
In the long term, those investments could reinforce Amazon’s market leadership and create significant barriers to entry for potential competitors.
Amazon Wall Street outlook
The new price target is in line with Wall Street’s outlook, which remains firmly bullish. Namely, a total of 44 analysts currently see an average upside potential of 35%, with the average Amazon share price target of $324.79 on TipRanks.
Advertisement
However, it must be noted that the recent quarterly results have led to a number of minor price cuts. The company reported revenue of $201.9 billion, broadly matching expectations, while operating income reached $28.1 billion, beating analyst estimates by 7.1%. However, AWS growth of 39% came in below expectations, despite representing an acceleration in the cloud division’s performance.
Following the results, TD Cowen thus maintained a “Buy” rating but lowered its target from $350 to $340, while StoneX reduced its target from $400 to $380 due to concerns about funding requirements, still with a “Buy” recommendation.
Goldman Sachs maintained a “Buy” rating but lowered the price forecast from $375 to $370, while Cantor Fitzgerald adjusted its price target from $310 to $280, noting that Amazon met revenue expectations and exceeded operating income estimates by 7%.
Featured image via Shutterstock
