Amazon stock price target raised to $272 by BofA on strong retail growth

Published 01/08/2025, 11:18
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Investing.com - BofA Securities raised its price target on Amazon.com (NASDAQ:AMZN) to $272.00 from $265.00 while maintaining a Buy rating following the company’s latest earnings report. The stock, currently trading at $234.11 and near its 52-week high of $242.52, has garnered strong analyst support, with InvestingPro data showing 10 analysts recently revising their earnings estimates upward.

Amazon reported revenue of $168 billion and profit of $19.2 billion, exceeding Street expectations of $162 billion and $17 billion respectively. The outperformance was primarily driven by the retail segment, which saw unit growth accelerate by 4 percentage points to 12% year-over-year. This success contributes to Amazon’s impressive 10.08% revenue growth over the last twelve months, with InvestingPro analysis indicating strong financial health with an overall score of "GREAT."

AWS, Amazon’s cloud computing division, posted growth of 17.5%, representing a 60 basis point acceleration quarter-over-quarter and slightly beating Street estimates. However, BofA noted AWS lacked the capacity-aided top-line beat similar to competitors Azure and GCP, while AWS margins missed expectations with a 6.5 percentage point quarterly drop.

For the upcoming quarter, Amazon guided revenue between $174 billion and $179.5 billion, surpassing Street expectations of $173 billion. The company projected profit between $15.5 billion and $20.5 billion, bracketing the Street’s prior estimate of $19.4 billion.

Capital expenditure reached $31 billion in the second quarter, with Amazon expecting stable levels through year-end. BofA indicated this would likely drive another upward revision exceeding $10 billion for 2025. With a market capitalization of $2.49 trillion and a P/E ratio of 37.31, Amazon continues to command premium valuations. For deeper insights into Amazon’s valuation metrics and growth potential, check out the comprehensive Pro Research Report available on InvestingPro.

In other recent news, Amazon.com reported impressive financial results for the second quarter of 2025, surpassing analysts’ expectations. The company achieved an earnings per share of $1.68, exceeding the forecasted $1.32, and generated revenue of $167.7 billion, outperforming the anticipated $162.05 billion. Following this strong performance, DA Davidson raised its price target for Amazon to $265 from $230, maintaining a Buy rating on the stock. Similarly, Goldman Sachs increased its price target to $240 from $220, also with a Buy rating. Goldman Sachs highlighted Amazon’s strategic focus on e-commerce operations amid tariff uncertainties and efforts to capture market opportunities in essentials and perishables. These developments underscore Amazon’s robust market position and its ability to exceed financial projections.

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