Amazon Gets a Double Upgrade From BofA and KeyBanc Ahead of Earnings: Is $325 the New Floor?

Amazon (NASDAQ:AMZN | AMZN Price Prediction) stock is heading into its April 29 Q1 earnings report with fresh momentum from two major Wall Street endorsements. BofA raised its AMZN stock price target to $298 from $275, while KeyBanc pushed its target all the way to $325 from $285, both maintaining their bullish ratings. The central thesis: AWS is reaccelerating, and the market may not be pricing it in yet.

Amazon shares traded at around $247 as of April 20, meaning KeyBanc’s $325 target represents a substantial premium to current levels. The stock is up 7% year-to-date, and both analyst calls signal growing conviction that the upcoming earnings report could be a meaningful catalyst.

The Analyst’s Case

BofA estimates Amazon Q1 revenue and EBIT of $178.4 billion and $21.4 billion, respectively, both above the Street at $177.1 billion and $20.7 billion. The firm is raising its year-over-year AWS growth estimate to 28%, above the Street consensus of 25%, but believes expectations could run as high as 29%. That’s a meaningful step up from the 24% growth AWS posted in Q4 2025, its fastest pace in 13 quarters.

KeyBanc’s thesis goes further. The firm believes the story of the quarter is AWS turning into “a 30%-ish grower” driven by capacity ramps and client wins. KeyBanc sees EPS approaching $10 per share in 2027, with additional optionality from AI advertising in Rufus, grocery share gains, and Amazon Leo.

Company Snapshot

Amazon operates across cloud computing, e-commerce, digital advertising, and emerging AI infrastructure. AWS generated $35.58 billion in Q4 2025 revenue, while advertising services added $21.32 billion, up 23% year-over-year. CEO Andy Jassy has committed to “about $200 billion in capital expenditures across Amazon in 2026,” with AI infrastructure at the center of that spend.

The company’s custom chip business, including Trainium and Graviton, carries combined annual revenue run rate over $10 billion, growing triple-digit percentages year-over-year. That emerging revenue stream makes KeyBanc’s longer-term EPS target credible, even if still early innings.

Why the Move Matters Now

With Q1 results due April 29, these upgrades arrive at a pivotal moment. KeyBanc acknowledges caution on Amazon’s operating income in H1 2026 due to gas prices and Leo investment costs, and Amazon’s own guidance flagged approximately $1 billion in higher year-over-year Amazon Leo costs in 2026. Free cash flow has come under pressure, with FY 2025 free cash flow declining to $11.19 billion as capex surged.

The prediction markets reflect real near-term uncertainty. The crowd assigns only a 25% probability of Amazon closing above $260 by end of April, suggesting the market is waiting for the earnings print before committing to the bull case. Tariff uncertainty and macro headwinds add caution heading in. For context on the broader AI infrastructure buildout driving AWS demand, data center spending trends remain a key watchpoint for cloud investors.

What It Means for Your Portfolio

For long-term investors, the dual price target raises signal genuine conviction that AWS’s reacceleration is durable. If AWS prints closer to 28% to 30% growth on April 29, that would validate both firms’ theses and could meaningfully shift sentiment on Amazon stock. The analyst community currently shows 49 Buy ratings and zero Sell ratings, reflecting broad Wall Street confidence.

The near-term setup carries real risk. Amazon’s history shows the stock can decline even on strong earnings beats, as it did in Q2 2025 when it fell 8% on earnings day despite a 26% EPS beat. Patient investors focused on the multi-year AWS and AI story may find the current setup compelling; those with shorter time horizons should weigh volatility risk carefully heading into the print.