Analysts Remain Optimistic for Amazon.com (AMZN)

We recently published 12 Best Consumer Cyclical Stocks to Buy According to Analysts.  Amazon.com, Inc. (NASDAQ:AMZN) is one of the best consumer cyclical stocks.

eCommerce giant Amazon.com, Inc. (NASDAQ:AMZN) is also a key player in the AI ecosystem. The firm has a partnership with AI firm Anthropic, and it dabbles in AI through its AWS cloud business and in-house AI chips.

As of November 28th, 48 out of the 67 analyst recommendations for Amazon.com, Inc. (NASDAQ:AMZN) were a Buy. Out of the remaining 19, 16 were a Strong Buy while three were a Hold. The average share price target for Amazon.com, Inc. (NASDAQ:AMZN) was $294.65.

Two recent analyst coverages for Amazon.com, Inc. (NASDAQ:AMZN)’s shares came on November 25th and November 18th. On the 25th, Rosenblatt maintained a Buy rating and a $305 share price target for the firm. After the firm’s third-quarter earnings, Rosenblatt had upgraded the price target to $305 from $298 on the back of growth in the AWS cloud business. Amazon.com, Inc. (NASDAQ:AMZN)’s AWS was a key concern ahead of the earnings, as the stock fell in August after the firm’s second-quarter earnings report revealed a 17.5% which was lower than Alphabet and Microsoft’s 32% and 39% growth rates. On November 18th, Rothschild Redburn downgraded the stock to Neutral from Buy on the back of worries about the return from heavy spending for the generational AI capacity buildout.

During Amazon.com, Inc. (NASDAQ:AMZN)’s third-quarter earnings call, BofA’s Justin Post asked management about AWS’ capacity growth. In response, CEO Andy Jassy commented:

“On the capacity side, we brought in quite a bit of capacity, as I mentioned in my opening comments, 3.8 gigawatts of capacity in the last year with another gigawatt plus coming in the fourth quarter and we expect to double our overall capacity by the end of 2027. So we’re bringing in quite a bit of capacity today, overall in the industry, maybe the bottleneck is power. I think at some point, it may move to chips, but we’re bringing in quite a bit of capacity. And as fast as we’re bringing in right now, we are monetizing it.”

While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.