Electronic commerce is such an unstoppable force in our pandemic-affected society that Goldman Sachs (NYSE: GS) analyst Heath Terry raised its target price on Monday to Amazon (NASDAQ: AMZN) at a level 28% above where the stock closed on Friday.
In May, it raised its target price to $ 3,000 due to the belief that the “long-term increase” in Amazon’s growth curve meant that the e-commerce giant’s shares would substantially outperform the market. Now, Terry notes that online sales continue to accelerate in North America as his reason for raising his target price to $ 3,800 per share; He also maintained his belief in the purchase of shares.
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No roof in sight
According to TheFly.com, Terry updated his projections for Amazon to reflect revenue growth 3% more annually than previously expected between 2020 and 2022. However, he suggests that among the costs associated with the operation during the Pandemic of COVID-19 and the If the infrastructure spending that will be required for the company to keep up with demand in both Amazon’s retail and web services increases, its earnings will not experience a similar boost.
The analyst has been very optimistic on Amazon for some time, seeing it as one of the best Internet stocks in its class in terms of risk versus reward due to the deep competitive fronts it has dug up not only in its e-commerce operations, but also in its surroundings. all of them.
Terry believes that the market underestimates the value of the Amazon platform in the long term, and sees the stock price accelerate as it catches up with other large-cap tech stocks. Over the past year, Amazon stock gained just 56% compared to other FAANG stocks like Netflix, which has increased by 59%, and Apple, which increased by more than 90%.
However, the rapid growth that Goldman Sachs has been waiting for seems to be happening this year: So far, in 2020, Amazon shares are up 67%, compared to 54% for Netflix and 32% for Apple.
