Phillip Securities upgraded Amazon.com to Buy from Accumulate on Monday and increased its price target from $320 to $330. The new target is in line with the broader Wall Street consensus, while analyst estimates cited in the report range from $230 to $405.
Analyst Helena Wang raised Phillip Securities’ fiscal 2027 revenue estimate for Amazon by 2% and its net income forecast by 3%, reflecting stronger expectations for Amazon Web Services. The firm also increased its fiscal 2027 capital expenditure estimate by 3%.
Phillip Securities said Amazon is well positioned in artificial intelligence because it is model-agnostic and combines custom chips, infrastructure and partnerships with large language model providers. The firm acknowledged that elevated capital spending is putting pressure on free cash flow, but said visible demand supports continued investment in infrastructure.
According to the report, Amazon’s revenue increased 15% over the past twelve months to $797 billion, while return on equity stood at 27%. InvestingPro analysis described the shares as undervalued, citing a price-to-earnings ratio of 19.2 relative to near-term earnings growth and a PEG ratio of 0.26.
The company recently reported third-quarter revenue of $201.9 billion and operating income of $28.1 billion. Operating income was 7.1% above Wall Street estimates, while the 13.9% operating margin was described as the highest in Amazon’s history. AWS growth of 39%, however, came in below some buy-side expectations.
Analyst reactions have varied. Piper Sandler reiterated an Overweight rating with a $320 price target, while TD Cowen maintained Buy but lowered its target to $340. StoneX reduced its target to $380 while keeping a Buy rating, and DA Davidson maintained a Neutral rating with a $250 target. Cantor Fitzgerald set a $280 target after highlighting the operating-income beat.
Sources: Investing.com News.