Amazon.com, Inc. (NASDAQ: AMZN) combines a few large businesses, such as e-commerce, cloud, advertising, and other revenue-generating businesses. With this mix, the firm historically generates more revenue and cash flow during Q4 of every year thanks to holiday shopping.
On the other hand, increased revenues do not always translate into strong returns, which might be the case this year as well, as the stock is down over 37% year-to-date (YTD). Meanwhile, Amazon is cutting costs left and right, with the firm confirming that it ended its home delivery robot program and scraped its “Glow” video device for children. Additionally, Amazon Explore product, a digital travel experience program, was also called off.
However, with the upcoming holiday season and a strong cost-cutting program, Amazon might have higher than usual revenue and lower costs, thus beating expectations on Wall Street.
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AMZN chart and analysis
Both the short-term and long-term trends are negative for Amazon, with the stock trading near the lower part of its 52-week range, below all moving averages. Over the past month, the shares traded from $105.34 to $124.71, with 53.1 million shares traded daily.
Technical analysis shows a support line at $102.31 and a resistance zone from $113.41 to $116.14.
Despite its poor performance in 2022, analysts rate the stock a ‘strong buy,’ with the average price in the next 12 months expected to reach $172.24, 61.12% higher than the current trading price of $106.90. Notably, out of 35 Wall Street analysts, 34 have a ‘buy’ rating, and one has a ‘hold’ rating.
In a tough environment for high-growth stocks, it is difficult to estimate how much the stock will go up; it will depend mostly on the market sentiment and the gap in actual earnings from the analyst’s estimation.
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