Amazon.com stock price target raised to $300 from $265 at Telsey

Investing.com - Telsey Advisory Group raised its price target on Amazon.com (NASDAQ:AMZN) to $300.00 from $265.00 on Friday, while maintaining an Outperform rating on the e-commerce and cloud computing giant. This target aligns with broader Wall Street sentiment, as InvestingPro data shows analyst consensus remains a Strong Buy with a high target of $306.

The price target increase represents a $35 boost from Telsey’s previous valuation, based on applying an enterprise value to EBITDA multiple of approximately 16 times the firm’s higher 2026 EBITDA estimate of about $198 billion. For context, Amazon’s current EBITDA stands at $133.83 billion, with the company trading at an EV/EBITDA multiple of 17.75.

Telsey expects Amazon to continue gaining market share by leveraging its Prime membership base, small business relationships, and technological advantages in the marketplace. As a prominent player in the Broadline Retail industry according to InvestingPro, Amazon currently generates $670.04 billion in revenue with 10.87% year-over-year growth.

The firm highlighted several key growth opportunities for Amazon, including grocery, private brands, pharmacy, logistics, and generative AI initiatives, which Telsey believes will increase the company’s overall value. With a market capitalization of $2.38 trillion, Amazon maintains a solid financial foundation for these initiatives, earning a "GREAT" overall financial health score from InvestingPro.

Telsey also noted that the "solid growth and profitability" of Amazon Web Services (AWS) cloud division and advertising business should continue to outperform and provide support to the company’s retail operations. While Amazon trades at a high P/E ratio of 34.27, InvestingPro identifies over 10 additional key insights and hundreds of metrics in its comprehensive Pro Research Report, available for this retail and tech powerhouse.

In other recent news, Amazon reported impressive third-quarter earnings, with revenue reaching $180 billion, marking a 12% increase year-over-year, excluding foreign exchange impacts. The company’s operating income hit a record-high margin of 12%, totaling $21.7 billion, which was 12% higher than Wall Street forecasts. Amazon’s AWS cloud division showed notable growth, with a 300 basis point sequential acceleration to a 20% growth rate, the fastest since the fourth quarter of 2022. Analysts have responded positively to these results, with BMO Capital, Citizens, BofA Securities, Evercore ISI, and Canaccord Genuity all raising their price targets for Amazon. BMO Capital and Canaccord Genuity both increased their targets to $300, while Citizens also set their target at $300. BofA Securities raised their target to $303, citing strong demand for Amazon’s Trainium chips. Evercore ISI set the highest target at $335, highlighting the significant AWS growth. These developments reflect Amazon’s strong performance and the positive outlook from major analyst firms.

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