24/7 Insights

• Analyst expectations for where Amazon.com Inc. (NASDAQ: AMZN) stock is headed vary somewhat.
• Despite some skeptics, Wall Street is optimistic overall, especially in the short term.

Amazon.com Inc. (NASDAQ: AMZN) has been one of the best long-term stocks in the history of the stock market. The company is now a colossal retail, cloud computing, artificial intelligence (AI), consumer electronics, media, and advertising conglomerate. While there can be little doubt about its current financial health, shareholders and would-be investors may be right to wonder whether growth can continue and whether the stock is safe. Let’s take a look at where the share price could be headed.

Why Invest in Amazon?

In the past 20 years, Amazon stock is up about 10,000%. The company has been called one of the most influential economic and cultural forces in the world, and its brand is one of the world’s most valuable. Though the stock tumbled as the COVID-19 pandemic waned and lockdowns ended (along with the broader markets), it has more than recovered. Shares of this Magnificent 7 member are now trading near an all-time high. It is hard to imagine that the company or its share price will collapse any time soon, but analysts and investors may see the stock as overbought. Let’s see what Wall Street expects.

Amazon, the Company

The company engages in the retail sale of consumer products, advertising, and subscriptions service through online and physical stores internationally. It also manufactures and sells electronic devices and develops and produces media content. Amazon Web Services (AWS) provides compute, storage, database, analytics, machine learning, and other services. And Amazon Prime is the company’s membership program.

Amazon is based in Seattle. It was founded in 1994 by Jeff Bezos, the former chief executive officer and now executive board chair. Amazon went public in May of 1997. Its retail competitors include Alibaba Group Holding Ltd. (NYSE: BABA), Kroger Co. (NYSE: KR), and Walmart Inc. (NYSE: WMT). It also competes with the likes of Netflix Inc. (NASDAQ: NFLX) and Microsoft Corp. (NASDAQ: MSFT).

Amazon’s 10th annual Prime Day sales are coming up. AWS is helping to boost generative AI startups, and it has big plans for AI infrastructure in Taiwan. This business previously announced partnerships with SAP and with CrowdStrike. In addition, the company posted better-than-expected first-quarter results.

This Is How Much Money Amazon Makes Every Minute

Amazon, the Stock

The share price is more than 51% higher than a year ago, much of that gain coming since the beginning of this year. The Nasdaq is up less than 31% year over year. Note that the $209.75 consensus price target is greater than the all-time high share price seen this past week.

Out of 47 analysts who cover the stock, all but seven recommend buying shares, 15 of them with Strong Buy ratings. BofA Securities, Wells Fargo, and others recently reiterated Buy-equivalent ratings. More than 62% of shares are held by institutional investors, including notable stakes at Vanguard, BlackRock, and State Street. Note that Bezos has revealed a plan to part with up to $5 billion worth of the shares.

Wall Street expectations for where the stock goes in the next 52 weeks vary. While at least one analyst anticipates huge upside, the lowest price target indicates a double-digit percentage drop in the share price. The consensus projection signals more modest upside potential for the next 52 weeks.

Low target	$167.64	−15.1%
Mean target	$209.75	6.2%
High target	$465.68	135.7%

Amazon does face some headwinds and risks. Consumers may pull back on spending due to ongoing inflation and a possible recession. Increasing costs of AI investment could have customers reducing spending as well. And while it dominates in the retail space and is a tech leader, competition in neither category is likely to go away anytime soon. All these things could have a huge impact on profitability.

Despite some skeptics, the prospects are optimistic overall, especially in the short term. The strong consensus Buy recommendation and the upside potential far outweighing the downside potential confirm this.

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