Amazon.com Inc (NASDAQ:AMZN) shares are down on Wednesday. The stock is pulling back following a recent bullish analyst report that highlights potential growth in Amazon Web Services (AWS) driven by advancements in artificial intelligence.
Wednesday’s move lower occurs as broader markets are experiencing downward pressure, with the Nasdaq-100 falling 1.74%. Here’s what investors need to know.
Is Amazon’s Cloud Strategy A Game Changer?
BofA Securities analyst Justin Post recently reiterated a Buy rating on Amazon with a price forecast of $303. He noted that improving sentiment around AWS’s AI capabilities could be a key driver for the company in 2026, especially after cloud concerns negatively impacted the stock in 2025.
Post also mentioned that Amazon’s valuation reflects uncertainty regarding AWS’s positioning, with the stock trading at about 11x Street 2027 EBITDA and 25x GAAP EPS. He views Amazon as his top large-cap internet stock for 2026, citing expected cloud acceleration and strong retail performance.
The broader market is experiencing a mixed day, with the State Street Consumer Discretionary SPDR Income ETF (AMEX:XLY) down 1.9% and the S&P 500 down 1.07%. This broader decline adds pressure to Amazon’s stock, indicating that its movement is part of a larger market trend rather than solely company-specific factors.
The Surprising Resilience Amid Market Declines
Amazon is currently trading 1.5% above its 20-day simple moving average (SMA) and 3.2% above its 100-day SMA, demonstrating some short-term strength. Over the past 12 months, shares have increased approximately 8.75%, and they are currently positioned closer to their 52-week highs than lows.
The RSI is at 60.90, which is considered neutral territory, while MACD is above its signal line, indicating bullish momentum. The combination of a neutral RSI and a bullish MACD suggests mixed momentum for the stock.
- Key Resistance: $239.00
- Key Support: $221.00
How Analyst Upgrades Signal Growing Confidence
Investors are looking ahead to the next earnings report on February 5.
- EPS Estimate: $1.95 (Up from $1.86 YoY)
- Revenue Estimate: $211.10 billion (Up from $187.79 billion YoY)
- Valuation: P/E of 34.3x (Indicates premium valuation)
Analyst Consensus & Recent Actions: The stock carries a Buy Rating with an average price target of $300.20. Recent analyst moves include:
- TD Cowen: Buy (Raised Target to $315.00)
- Wells Fargo: Overweight (Raised Target to $301.00)
- Cantor Fitzgerald: Overweight (Lowered Target to $260.00)
Valuation Insight: While the stock trades at a premium P/E multiple, the strong consensus and 5% expected earnings growth suggest analysts view this growth as justification for the 26% upside to analyst targets.
Benzinga Edge Rankings
Below is the Benzinga Edge scorecard for Amazon, highlighting its strengths and weaknesses compared to the broader market:
- Value: Neutral (Score: 51.49/100) — The stock is trading at a premium relative to peers.
- Quality: Strong (Score: 72.86/100) — The balance sheet remains healthy.
- Momentum: Moderate (Score: 49.87/100) — The stock is showing mixed performance relative to the market.
The Verdict: Amazon.Com Inc’s Benzinga Edge signal reveals a mixed outlook. While the Quality score indicates a healthy balance sheet, the Value score suggests the stock is trading at a premium, which may concern some investors.
Top ETF Exposure
- American Century Focused Dynamic Growth ETF (NYSE:FDG): 9.10% Weight
- iShares Global Consumer Discretionary ETF (NYSE:RXI): 9.72% Weight
- Dana Unconstrained Equity ETF (NYSE:DUNK): 8.75% Weight
Significance: Because AMZN carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
Price Action
AMZN Price Action: Amazon shares were down 2.35% at $236.91 at the time of publication on Wednesday, according to Benzinga Pro data.
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