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Amazon Scores Price Target Increase Ahead Of Fourth-Quarter Report

Amazon Scores Price Target Increase Ahead Of Fourth-Quarter Report
31 Jan 2018

E-commerce leader Amazon (AMZN) received a price target increase Tuesday, just ahead of its fourth-quarter earnings report and as the stock continues to reach new highs.

Needham analyst Kerry Rice raised his price target on Amazon to 1,600 from 1,250 and maintained a buy rating. That’s an 11% premium from where Amazon currently trades, with shares closing Tuesday at 1,437.82, up 1.4% on the stock market today.

Amazon shares are up 46% since it reported third-quarter results on Oct. 26 that crushed earnings views and topped revenue estimates. The stock has hit a succession of new highs since breaking out on Jan. 4 from a shallow flat base.

Amazon is scheduled to report fourth-quarter earnings after the market close Thursday. The consensus estimate is for Amazon to report revenue of $59.8 billion, up 37%, from the year-ago period and adjusted earnings of $1.88 a share, up 22%.

“We expect Amazon to modestly beat on both revenue and profitability, driven by a strong holiday season, continued strength in Amazon Web Services, as well as rapidly growing advertising revenue,” Rice wrote in a research note to clients.


IBD’S TAKE: Amazon is a longtime member of IBD’s exclusive list of Leaderboard stocks, which investors can use to track stocks and stay a step ahead of the market. Amazon is currently out of buy range from a 1,213.51 buy point. IBD’s  The Big Picture can help you stay on top of the market direction, informing you when to be aggressive and when to move to the sidelines.


Rice believes Amazon will report a stronger-than-expected holiday sales season as e-commerce continues to grow faster than broader retail. Amazon’s Prime membership program also continues to be a key revenue driver, wrote Rice, saying he also expects strong growth in Amazon’s advertising business.

Amazon scored record sales on Cyber Monday and Black Friday as consumers responded to a raft of promotions.

Also on Tuesday, Amazon, Warren Buffett’s Berkshire Hathaway (BRKB) and JPMorgan Chase(JPM) announced that they are “partnering on ways to address healthcare for their U.S. employees, with the aim of improving employee satisfaction and reducing costs.”

Source: Investors Business Daily

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