Hansen, Mueller Industries director, sells $105,710 in stock
Investing.com -- KeyBanc began coverage of Amazon.com with an Overweight rating and a $300 price target, saying advertising and grocery expansion will support growth while investors underestimate a rebound in its cloud unit, AWS.
Advertising is fueling Amazon’s retail gains and could pave the way for grocery to become a bigger contributor over the medium term.
KeyBanc analyst expects grocery investments such as same-day delivery expansion to more than 2300 U.S. cities by the end of 2025 to lift North American growth as smaller grocers lose share.
KeyBanc added that the market’s view of Amazon Web Services as an AI laggard is misplaced. The analysts said AWS’s slower growth versus peers stems from scale constraints rather than lost demand, and that new data center projects such as Project Rainier, which will power AI startup Anthropic’s training clusters, could help accelerate growth in 2026.
AWS, which accounts for about 60% of Amazon’s operating income, continues to dominate the infrastructure-as-a-service market with 38% share, ahead of Microsoft and Google.
KeyBanc said AWS remains well-positioned to capture AI-driven workloads once new capacity comes online.
On advertising, the firm pointed to Amazon’s off-platform ad network as an underappreciated driver. The expansion of its demand-side platform (DSP) and new third-party media partnerships are expected to add incremental growth, with most revenue still coming from ads on Amazon.com and Prime Video.
KeyBanc said Amazon’s valuation, trading at 22.9 times its projected 2027 earnings, sits below historical averages, presenting an attractive entry point.
“We would be surprised if AWS was left behind in the AI revolution,” the analysts said.