As Amazon’s (NASDAQ: AMZN) share price approaches the $200 resistance level following impressive Q3 earnings, the stock has witnessed significant insider trading activity.
Specifically, Amazon founder and executive chairperson Jeff Bezos is escalating his stock-selling spree for 2024, this time offloading over $3 billion worth of the company’s shares in a recent transaction, according to regulatory filings on November 1.
The latest sale involved over 16 million shares at a time when Amazon is once again nearing the $200 per share valuation. Notably, Bezos offloaded $5 billion of Amazon shares in July when the equity surpassed the $200 mark.
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In February, he earned about $8.5 billion in transactions that spanned nine trading days. In these transactions, he seemingly had a limit order to sell shares above $200.
The sales align with an established Rule 10b5-1 plan to sell Amazon shares through December 31, 2025. This plan is used by insiders to avoid any potential bias related to nonpublic information, automatically executing sales or purchases when specific conditions, such as price, are met.
Bezos has used his stock sales to fund other projects, including his Blue Origin space venture.
AMZN surges 6% after earnings
Meanwhile, AMZN stock ended the last trading session up over 6%, trading at $197.93. While most equities in the technology sector have seen a sell-off, AMZN has been bullish, gaining over 4% in the past week.
From a technical perspective, institutional market analyst Walter Deemer noted in an X post on November 1 that Amazon’s stock has been trading with volatility reminiscent of a meme stock rather than a company with a $2 trillion market cap.
The analyst pointed out that the stock exhibited highly unusual behavior over the last three days leading up to the earnings call: an upside gap, followed by a downside gap forming an island reversal, and an even larger upside gap. This sequence of moves is rarely seen in high-cap stocks.
For Amazon, the stock’s movement could signal investor excitement around the company’s earnings.
Positive investor reactions to the company’s Q3 earnings and forecast drove the latest upward momentum in the equity. During the quarter, Amazon’s earnings per share were $1.43, beating expectations of $1.16. Revenue reached $157.29 billion.
For the last quarter of the year, Amazon projects revenue between $181.5 billion and $188.5 billion, against an analyst forecast of $186.36 billion.
What next for AMZN stock
In response to the earnings report, analysts at RBC Capital Markets increased AMZ’s stock price target to $225 from $215, maintaining an ‘Outperform’ rating.
Goldman Sachs (NYSE: GS) analyst Eric Sheridan also raised Amazon’s stock price target from $230 to $240, citing the earnings report’s positive impact. Sheridan said the results have “increased confidence in our medium/long-term thesis around Amazon’s platform drivers (in both revenue compounding and margin trajectory).”
Meanwhile, JPMorgan (NYSE: JPM) analysts raised the stock’s price target from $230 to $250, noting they were “comfortable” with the company’s increased expenditures, especially around its artificial intelligence ventures. These estimates align with the technical indicator projection that places Amazon in the $240 range.
Featured image:
Rokas Tenys – Kaunas, Lithuania – 2022 April 14. Digital Image. Shutterstock.
