Cantor Fitzgerald raises Amazon stock price target to $240

On Friday, Cantor Fitzgerald analyst Deepak Mathivanan increased the price target for Amazon.com (NASDAQ:AMZN) shares to $240.00, up from the previous target of $230.00, while maintaining an Overweight rating on the stock. The revision follows Amazon’s first-quarter earnings report, which showed revenues that aligned with expectations and earnings before interest and taxes (EBIT) that were 5% higher than previous estimates from Wall Street, excluding one-time charges. With a market capitalization of $2.02 trillion and a P/E ratio of 33.7x, Amazon trades at a premium valuation, though InvestingPro analysis suggests the stock is currently undervalued based on its Fair Value model.

Amazon’s cloud computing division, Amazon Web Services (AWS), reported a growth of 17%, which, despite a 2-point deceleration, met the forecasts of Wall Street analysts. This growth rate was slightly below some buy-side expectations, especially after Microsoft (NASDAQ:MSFT)’s Azure reported stronger performance earlier in the week. Notably, AWS margins increased by 250 basis points quarter over quarter to 39.5%, marking the highest levels on record. This performance contributes to Amazon’s overall strong financial health, rated as "Good" by InvestingPro, which highlights the company’s moderate debt levels and sufficient cash flows to cover interest payments.

Looking ahead, Amazon has provided guidance for second-quarter revenue growth of 7-11%, which suggests some demand acceleration in anticipation of potential tariffs. The company’s second-quarter EBIT forecast of $13-17.5 billion aligns with the higher end of Wall Street’s expectations, signaling a relatively stable retail operating environment so far.

Despite the current uncertainties, particularly concerning tariffs and their impact on demand in the second half of the year, Mathivanan expressed confidence in Amazon’s long-term outlook. He noted that Amazon is well-positioned to gain competitively during macroeconomic disruptions, benefiting both its AWS and Retail operations over the long term. The new price target of $240 reflects an adjustment to account for potential softness in the second half of the year, while reiterating the Overweight rating on Amazon shares.

In other recent news, Amazon.com Inc reported a first-quarter revenue of $156 billion, marking a 10% year-over-year growth, excluding foreign exchange impacts. However, the company’s operating income guidance fell short of expectations, which led Susquehanna to lower its price target for Amazon stock to $225. Despite this, Susquehanna noted Amazon’s strong performance in advertising and AWS, with AWS showing a 17% year-over-year growth. JMP Securities raised its price target for Amazon to $250, citing strong top-line results and robust performance in AWS. Evercore ISI also adjusted its price target for Amazon to $260, acknowledging a mix of achievements and challenges in the company’s first-quarter earnings report.

Goldman Sachs maintained its Buy rating on Amazon with a $220 price target, emphasizing the company’s ability to deliver long-term value despite near-term challenges. Amazon’s guidance for second-quarter revenue was above expectations at the high end, although its operating income projections were less optimistic. The company cited costs related to Project Kuiper and an annual increase in Share-Based Compensation as factors impacting operating income. Meanwhile, Amazon’s shares experienced a 2.2% drop in premarket trading following a weaker-than-expected outlook for operating income. These developments highlight ongoing investor interest in Amazon’s performance and future prospects.

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