Amazon Inc. (AMZN)
Amazon.com’s recent quarterly earnings report delivered a mixed performance., while the company’s revenue exceeded Wall Street analyst expectations, earnings per share came in slightly below forecasts. In addition, investors are concerned as Amazon announced an aggressive capital expenditure plan of approximately $200 billion for 2026, which far exceeds analyst expectations. This combination of mixed results and elevated spending contributed to a decline of more than 10% in after-hours trading following the earnings release.
Despite this short-term market reaction, analyst sentiment on Amazon remains broadly positive. BMO Capital Markets recently reiterated its Outperform rating on the stock and maintained a 12-month target price of $311 per share. Analysts emphasize that Amazon’s diversified operations, including its e-commerce platform, Amazon Web Services (AWS), and advertising business, provide strong growth potential. BMO’s rating reflects confidence that Amazon’s long-term earnings growth will outweigh near-term volatility.
Similarly, UBS Securities also reaffirmed its Outperform rating with a previous price target of $311 per share, highlighting Amazon’s scale and ongoing growth initiatives, particularly in cloud computing and infrastructure, as key factors supporting future upside potential. Analysts also noted that while the company’s massive capital spending could pressure short-term margins, the long-term benefits from AWS growth and infrastructure expansion are likely to support strong revenue and profit trends over time.
Overall, the market’s negative reaction appears to be driven primarily by concerns over Amazon’s large-scale capital expenditures and near-term profitability pressures. Nevertheless, the continued Outperform ratings from both BMO Capital Markets and UBS Securities suggest that analysts view the sell-off as a response to short-term uncertainty rather than a change in Amazon’s underlying fundamentals. Investors who focus on the long-term prospects of Amazon’s cloud business, e-commerce growth, and advertising operations may see the recent pullback as a potential buying opportunity.
STA Research (StockTargetAdvisor.com) is a independent Investment Research company that specializes in stock forecasting and analysis with integrated AI, based on our platform stocktargetadvisor.com, EST 2007.
