Wedbush raises Amazon stock price target to $340 on OpenAI deal

Investing.com - Wedbush raised its price target on Amazon.com (NASDAQ:AMZN) stock to $340.00 from $330.00 on Monday, while maintaining an Outperform rating following Amazon’s partnership announcement with OpenAI. Amazon shares are currently trading at $255.28, up 7.6% over the past week and have surged 28.55% in the last six months. According to InvestingPro data, the stock is trading near its 52-week high with analysts maintaining a Strong Buy consensus.

Amazon announced a multi-year strategic partnership with OpenAI on Monday. The agreement, valued at $38 billion, will see AWS provide OpenAI with Amazon EC2 UltraServers to run and scale OpenAI’s core artificial intelligence workloads. This deal comes as Amazon, with its massive $2.73 trillion market cap and $691.33 billion in revenue, continues to strengthen its position as a prominent player in the Broadline Retail industry.

The implementation begins immediately, with all planned capacity scheduled to come online by the end of 2026. The partnership includes provisions for continued growth over the next seven years.

OpenAI will initially utilize existing AWS data centers for its operations. Amazon plans to eventually build additional dedicated infrastructure specifically for OpenAI.

Wedbush noted that this deal builds upon Amazon’s current partnership with Anthropic, where Amazon serves as that AI company’s primary cloud provider.

In other recent news, Cipher Mining Inc. has entered into a significant $5.5 billion, 15-year lease agreement with Amazon Web Services (AWS) to provide space and power for AI workloads. This agreement includes delivering 300 megawatts of capacity by 2026, with the project expected to be completed by the fourth quarter of that year. Meanwhile, Amazon.com has seen multiple analyst firms raise their price targets following its strong third-quarter performance. Benchmark increased its price target to $295, citing confidence in Amazon’s business trajectory. Stifel also raised its target to $295, noting AWS’s 20% growth, which outpaced competitors. UBS went further, setting a new target of $310 due to AWS’s accelerated growth. Cantor Fitzgerald set the highest target at $315, highlighting Amazon’s third-quarter results that exceeded expectations and strong fourth-quarter guidance. These developments reflect a positive outlook on Amazon’s continued growth and investment returns.

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