By
Chimamanda U. Martha
March 11th, 2024
Calling Amazon the “structural winner” and the “best global play” coming from the COVID-19 pandemic, RBC’s Mark Mahaney raised his price target for AMZN stock from $2,700 to $3,300.
Amazon.com Inc (NASDAQ: AMZN) is one of the winners in the coronavirus pandemic. AMZN stock has not only managed to keep its price level but also hit a new record due to the giant expanding its business. Year to date, Amazon stock has rallied over 35%, giving cause for investors’ enthusiasm to grow and analysts’ prognosis to shift for the better.
The biggest bull on Wall Street that believes Amazon stock will go higher is RBC Capital analyst Mark Mahaney. Calling Amazon the “structural winner” and the “best global play” coming from the COVID-19 pandemic, Mahaney raised his price target for AMZN from $2,700 to $3,300. Notably, it is the highest target that exceeds $3,000 of FactSet.
Mahaney has based his opinion on a survey of over 2,800 consumers. He has found out that the surge in online shopping demand “has created a sustainable shift in consumer behavior.” It turned out that 64% of Amazon customers make at least two or three purchases a month, up from 54% a year earlier. 45% of respondents said they have spent more than $200 on Amazon over the past 90 days, up from 36% a year ago.
Mahaney wrote:
“Most importantly, Prime penetration surged to 67% vs. 59% in 2019–we see Amazon rapidly approaching 200MM Prime subs worldwide, up from 150MM in January.”
Further, he added:
“All in, Amazon appears to be running away with the U.S. online retail crown and remains in a very strong position, while Walmart’s position is incrementally improving.”
With Mahaney’s target price, AMZN stock would bring the retailer’s valuation to a record of $1.6 trillion.
Baird Updated Its Rating for Amazon
Baird analysts have raised a price target on Amazon stock as well. Baird’s Colin Sebastian uplifted his target price to $2,750 from $2,550. In addition, he raised his revenue estimate for the second quarter to $83.5 billion from $80.3 billion, to reflect “strong e-commerce data through May, as well as positive Amazon-specific checks.”
Sebastian wrote:
“Following generally strong e-commerce data through May, as well as positive Amazon-specific checks, we are increasing our Q2 revenue and operating income estimates above consensus.”
He continued:
“Amazon has reopened warehouses to third-party inventory, resumed selling products in non-essential categories, and in late April, restarted advertising on some large platforms such as Facebook.”
AMZN Stock 1.65% Up
Since hitting a one-year low on March 16, Amazon shares have soared about 53%. Year-to-date, Amazon stock has gained approximately 36%.
On Monday, Amazon stock added 1.65% to close at $2524.06. In the pre-market trading today, it makes up $2,531 per share. Its market cap is $1.24 trillion.