Wedbush Reiterates Outperform on Amazon (AMZN) Ahead of Earnings

Amazon.com, Inc. (NASDAQ:AMZN) is one of the 10 AI Stocks Gaining Attention on Wall Street. On January 30, Wedbush analyst Dan Ives reiterated an Outperform rating on the stock with a $340.00 price target. The firm sees robust AWS momentum for AMZN, robust Q4 setup, and a $25.2B OI forecast reinforcing multiple expansion potential.

The rating affirmation comes ahead of the company’s fourth-quarter earnings report scheduled for Thursday, February 5. Webush believes that investor confidence has been building, and Amazon’s previous quarter report has had sentiment turn more positive.

“AWS growth was well ahead of expectations, and we are encouraged by the implied level of AWS demand given the pace of backlog growth and additional supply coming online over the next twelve months.”

The firm further said that it believes 2026 is going to be a big year for AWS, potentially serving as a catalyst for shares. With shares trading for ~22x our 2027 GAAP EPS estimate, it believes the risk-reward is attractive ahead of fourth quarter.

“We believe another robust quarter of AWS growth and continued proof points from partners could be the key to drive multiple expansion in the coming quarters.”

Overall, Wedbush is constructive on the setup leading into the report due to positive commentary around AWS growth, healthy trends for the core retail business, and robust advertiser demand.

It has raised its estimates for Amazon, projecting fourth-quarter operating income of $25.2 billion (11.8% margin), an estimated 1% above consensus. Meanwhile, it expects operating income of $103.0 billion (12.8% margin) for the full year.

“Amazon remains our top eCommerce pick for 2026, and we reiterate our Outperform rating and $340 PT.”

Amazon.com Inc. (AMZN) is an American technology company offering e-commerce, cloud computing, and other services, including digital streaming and artificial intelligence solutions.

While we acknowledge the potential of AMZN as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

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