Why Amazon Stock (AMZN) Is Still a Bullish Bet—Even as AWS Feels the Squeeze
Amazon’s cloud division might be sweating—but the retail giant’s stock still has rocket fuel left.
Here’s why one top analyst is doubling down on AMZN despite AWS cost pressures.
The AWS Elephant in the Room
Yes, cloud margins are tightening. Yes, competitors are circling. But Amazon’s secret sauce? A brutal diversification play that Wall Street keeps underestimating.
Retail’s Silent Rebound
While analysts obsess over AWS, Amazon’s e-commerce engine is quietly printing money again. Prime subscriptions? Still growing like weeds. Ad revenue? A cash cannon.
The Long Game
Unlike meme-stock traders, Amazon plays chess—not checkers. Their logistics moat could swallow small nations whole. And let’s not forget those 1,000+ satellites overhead.
The Bottom Line
In a market obsessed with quarterly whispers, Amazon’s building the next empire—one drone delivery at a time. (But sure, keep worrying about cloud margins.)
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It is worth noting that Morton has a success rate of 70%, with an average return per rating of 22.5% over a one-year timeframe.
Top Analyst’s Take on Amazon
The analyst said that while Amazon is known for its shopping business, its real profits come from Amazon Web Services (AWS) and advertising. After Amazon gave more detail on its cloud business in the, Morton updated his AWS forecast and believes that most analysts may be underestimating the rising costs from Amazon’s large cloud investments.
He estimates Amazon will spend about “$200 billion from FY24 to FY26” to expand AWS, mostly on servers and network equipment. As a result, depreciation costs at AWS are set to rise from “13% in Q424 to 23% in Q426.” This could lower AWS profit margins by about 10 percentage points.
Even with some margin pressure ahead, Morton remains positive on Amazon’s outlook. He’s more optimistic than most analysts about the next 18 months, especially when it comes to AWS margins in 2025. He expects Amazon to beat profit estimates in both 2025 and 2026, supported by strong demand, better cost efficiency, and steady growth in its high-margin advertising business.
His updated price target of $253 reflects the view that Amazon’s strong earnings performance in the NEAR term is not yet fully priced in by the market.
What Is the Price Target for Amazon Stock?
Overall, Wall Street is bullish on Amazon stock, with a Strong Buy consensus rating based on 47 Buys and one Hold recommendation. The average AMZN stock price forecast of $243 indicates 14.21% upside potential.
