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As of now, Amazon stock is trading at around $185.01 per share.
Analysts predict that Amazon stock could rise by up to 30% over the next 12 months, with some targets reaching as high as $265.
Evercore ISI analyst Mark Mahaney is particularly optimistic about Amazon, increasing his 12-month price target to $240, reflecting a 30% upside potential.
Amazon's growth is driven by multiple factors, including its e-commerce platform, Amazon Web Services (AWS), and Prime Video. AWS alone accounted for 63% of Amazon's operating income in Q2.
Prime Video is a significant growth driver for Amazon. The streaming service has attracted nearly 50 million viewers with its original content, including *The Idea of You* and *Fallout*. It also inked major deals with the NBA and WNBA, and it will carry the 2024 Professional Pickleball Association (PPA) World Championships.
Evercore ISI believes that Amazon can monetize Prime Video more effectively than ever, projecting that the unit will generate revenue of $3 billion to $5.9 billion next year, which could boost Amazon's total advertising revenue by as much as 9% year over year.
The current sentiment around Amazon stock is neutral, with the Fear & Greed Index indicating fear. However, many analysts still see Amazon as a strong buy, with a consensus rating of Strong Buy based on 44 buy ratings and 1 hold rating.
Earnings-based valuation metrics have been less reliable for Amazon due to the company's significant investments in growth. Despite this, Amazon's stock remains a great pick for long-term investors.
The average 12-month price target for Amazon stock is around $224.05, representing a 21.02% upside potential from the current price.
Amazon has outperformed its overall industry in the last calendar year, beating sales estimates 75% of the time compared to 53.17% for the industry as a whole.
Given the positive outlook from analysts and the company's strong performance, investors may consider buying Amazon stock, especially if it's trading below its forecasted price.