Earnings

Amazon Price Targets Heading Higher as Quarterly Earnings Date Nears


Denis Charlet/AFP via Getty Images

As the end of the June quarter approaches, Wall Street analysts are hustling to raise their financial forecasts and price targets for
Amazon.
com to reflect strength in both e-commerce and cloud computing.

Note that 40 of the 46 analysts who follow Amazon (ticker: AMZN) have a Buy or Strong Buy rating on the stock, but the average analyst target price is flat with the current stock price. Unless you think the stock is about to be hit by a wave of downgrades, you can expect to see a steady stream of target increases as we get closer to the company’s earnings announcement in July.

Ergo, Deutsche Bank analyst Lloyd Walmsley, who has a Buy rating on Amazon shares, on Friday lifted his target to $3,333 from $2,750, to reflect “robust and continued growth in e-commerce even as lockdowns stated to ease.” He thinks shoppers will stick with Amazon—whether we move into a recovery, or continue in a pandemic. Walmsley writes in a research note that a recent survey finds that consumers rate the service higher than other online shopping destinations for price and value, selection, convenience and trust.

SunTrust Robinson Humphrey analyst Youssef Squali likewise repeated a Buy rating on the stock, boosting his target to $3,400, from $2,700. His firm also surveyed shoppers and found the results appealing for Amazon investors. “Covid-19 catalyzed a faster transition to e-commerce, which we believe is here to stay,” he writes. “Amazon acquired brand-new customers to the platform, and who are likely to stick. [And] Amazon’s NPS [Net Promoter Score] is the best amongst peers, with the vast majority of customers expecting to at least sustain, if not increase their purchase frequency post pandemic.”

Amazon shares were up fractionally at midday Friday, to $2,760.96.

Write to Eric J. Savitz at eric.savitz@barrons.com

This article was originally published on Barron’s

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