BMO Capital raises Amazon stock price target to $270 on AWS demand

Investing.com - BMO Capital raised its price target on Amazon.com (NASDAQ:AMZN) to $270.00 from $233.00 on Tuesday, while maintaining an Outperform rating on the stock. The e-commerce giant, currently valued at $2.42 trillion, maintains a "GREAT" financial health score according to InvestingPro analysis.

The firm cited improving AWS demand expected for the second half of 2025, noting that agentic capabilities remain underappreciated by the market. BMO increased its AWS estimates as these agentic capabilities are expected to unlock significant efficiency gains, combined with steady consumption and improving commitments in the latter half of 2025. This optimism aligns with Amazon’s solid revenue growth of 10.08% over the last twelve months.

BMO Capital also pointed to Amazon’s extended Prime Day and foreign exchange factors as prompting a 130 basis point increase in its 2025 Gross Merchandise Value (GMV) forecast. The firm’s proprietary channel checks indicated mid-teens GMV growth year-over-year compared to the same four-day period last year, while average selling prices remained stable despite tariffs.

The research note highlighted that Amazon’s same-day delivery coverage has increased 17% year-over-year, which enables rising frequency and free cash flow growth within the retail segment.

BMO Capital reiterated its Outperform rating on Amazon stock while increasing both its estimates and target price to $270 from the previous $233. According to InvestingPro analysis, Amazon appears slightly undervalued at current levels, with investors eagerly awaiting the company’s next earnings report on July 31, 2025. For deeper insights into Amazon’s valuation and growth prospects, check out the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Amazon.com is drawing attention from analysts with several firms raising their price targets for the company. Scotiabank (TSX:BNS) increased its price target to $275, citing strong Prime Day performance, while maintaining a Sector Outperform rating. Needham also raised its price target to $265, reflecting increased confidence in Amazon’s financial outlook and maintaining a Buy rating. Citi matched this target of $265, highlighting a positive growth outlook for Amazon Web Services (AWS) and expecting the upcoming Q2 2025 financial results to surpass consensus expectations. Additionally, Amazon, along with other tech giants, has been questioned by U.S. lawmakers about their security measures related to submarine communications cables potentially serviced by Chinese and Russian entities. These developments come as Amazon prepares to release its Q2 2025 earnings report, which is anticipated by analysts to show strong performance in both revenue and operating income.

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