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Investing.com - Canaccord Genuity raised its price target on Amazon.com (NASDAQ:AMZN) to $300.00 from $280.00 on Friday, while maintaining a Buy rating following the e-commerce giant’s third-quarter results. With a current market capitalization of $2.38 trillion and analyst consensus strongly bullish at 1.28 (where 1 is Strong Buy), Amazon appears fairly valued according to InvestingPro Fair Value estimates.
Amazon reported Q3 revenue 1% above consensus expectations, with operating income exceeding forecasts when excluding one-time expenses related to an FTC settlement and severance costs. The company’s AWS cloud division showed significant improvement, with growth accelerating approximately 270 basis points quarter-over-quarter to over 20% - its highest growth rate in eleven quarters. This performance aligns with Amazon’s overall revenue growth of 10.9% over the last twelve months, reaching $670 billion.
AWS now has a $200 billion backlog as of the end of Q3, with the company adding more than 3.8 gigawatts of power capacity in the past 12 months. Management expects to double power capacity by 2027 and plans to bring another gigawatt online in Q4. The company’s Trainum2 AI chip business grew 150% quarter-over-quarter and is now described as a "fully subscribed, multibillion-dollar business." InvestingPro data shows Amazon operates with a moderate debt level and maintains sufficient cash flows to cover interest payments, supporting this ambitious expansion.
Amazon’s online stores continue to benefit from momentum in Everyday Essentials products, which have grown nearly twice as fast as the rest of the business year-to-date. Advertising revenue growth accelerated 60 basis points quarter-over-quarter, driven by Prime Video and Amazon DSP. This diversified revenue approach helps maintain Amazon’s impressive 49.6% gross profit margin, according to the latest InvestingPro data.
The company guided to fiscal year 2025 capital expenditures of $125 billion, approximately 6% above consensus, and indicated that figure is expected to increase next year. Amazon shares rallied in after-hours trading following what Canaccord Genuity characterized as "an inflection point for AWS." With a "GREAT" overall financial health score of 3.2 according to InvestingPro, Amazon demonstrates strong fundamentals despite trading at a high P/E ratio of 34.3. Investors can access Amazon’s comprehensive Pro Research Report, one of 1,400+ deep-dive analyses available exclusively on InvestingPro.
In other recent news, Amazon.com Inc. reported its third-quarter 2025 earnings, surpassing expectations with an earnings per share (EPS) of $1.95 compared to the forecasted $1.56. The company’s revenue reached $180.2 billion, slightly higher than the anticipated $177.75 billion. Despite the strong financial performance, Amazon’s stock experienced a decline in after-hours trading. In addition, Goldman Sachs has reiterated its Buy rating on Amazon, raising the price target from $275 to $290. The investment bank highlighted Amazon’s potential for strong compounded revenue growth and operating margin expansion over multiple years. These developments reflect the company’s ongoing efforts to invest in long-term growth initiatives. The recent earnings results and analyst updates provide important insights for investors monitoring Amazon’s performance.
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