Wells Fargo Reiterates Overweight Rating for Amazon (AMZN) as AI Compute Demand Doubles

Amazon.com Inc. (NASDAQ:AMZN) is one of the best high volume stocks to invest in now. On February 23, Wells Fargo lowered its price target for Amazon.com from $305 to $304 while keeping an Overweight rating. This sentiment was posted as the firm identified compute capacity as the critical factor for success, as AI demand outpaces supply. Wells Fargo projects hyperscaler capacity will double to 98GW by 2027, supported by $860 billion in annual capital expenditures, and expects the cloud industry to grow significantly faster than current consensus estimates. Earlier on February 6, Benchmark reduced its price target for Amazon.com Inc. (NASDAQ:AMZN) to $275 from $295 and maintained a Buy rating following the company’s earnings report. The adjustment reflected Amazon’s plan to invest $200 billion in capital expenditure this year, exceeding market expectations by ~$40 billion. Despite the reaction to these investment estimates, Benchmark highlighted that the AWS cloud segment grew 24% year-over-year with an increasing quarterly dollar contribution, while retail efficiency improved and AWS margins remained strong. Zapp2Photo/Shutterstock.com Amazon.com Inc. (NASDAQ:AMZN) engages in the retail sale of consumer products, advertising, and subscription services through online and physical stores in North America and internationally. The company has three segments: North America, International, and AWS (Amazon Web Services). 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. Follow Insider Monkey on Google News.