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After Amazon (AMZN-US) announced that its first-quarter profit was worse than expected, the stock price fell 7.6% on Friday, but Wall Street analysts raised their target prices. and they shouted with enthusiasm to buy.
Amazon expects operating income to break even in the second quarter. Although first-quarter revenue growth was better than expected, costs have also increased, as Amazon has hired an additional 175,000 to respond to e-commerce needs for the home office and home study. Employees.
Not surprisingly, profit taking on Amazon stock has ended. As of Thursday’s close, Amazon shares have risen 34%, and Wall Street analysts remain optimistic about Amazon’s e-commerce business and AWS cloud units. More than ten analysts raised Amazon’s target price on Friday, and most comments remain strongly optimistic about Amazon’s position in the recession.
Amazon CEO Bezos (Jeff Bezos) said the Covid-19 crisis is demonstrating the adaptability and durability of Amazon’s business, which is unprecedented and is the most difficult time to date. “Under normal circumstances, the company expects to generate more than $ 4 billion in operating profit in the second quarter, but expects the money to be spent in full or even more on Covid-related expenses to provide customers with products while protecting employee safety. ” He mentioned that Amazon now has a dedicated team dedicated to improving Covid-19’s detection capabilities.
JPMorgan analyst Doug Anmuth reiterated Amazon’s “overweight” rating on stocks, with a $ 3000 price target of $ 2,525 to $ 3,000, a high on Wall Street and placing Amazon on the top list.
“We believe Amazon may be the only company that can provide good customer service in a period of crisis and efficiency. Although the recent cost is higher, the advantage is that it can increase customer loyalty and adopt more e-commerce channels. quickly”. “
Morgan Stanley analyst Brian Nowak reiterated its weighted rating and raised its price target from $ 2,400 to $ 2,650. It also placed Amazon on the top list. He believes Amazon’s earnings report this quarter “strengthened our view that outbreak avoidance practices in the central office and in the classroom can accelerate the growth of e-commerce, and Amazon’s recovery will accelerate and spread.” .
Nowak believes that Amazon’s commitment to invest in anti-epidemic equipment for employees and customers will be a potential competitive advantage. “In the future, we expect consumers to have greater requirements for the sterility of packaging and products. Amazon’s investment makes it unique. Competitors, raising the cost of competing with their peers. “
Rohit Kulkarni, an analyst at MKM Partners, believes that Amazon can become a major player in the healthcare arena after emerging from the recession. At the same time, you will also benefit from the “fast-paced online grocery and home shopping trend.” “Amazon is innovating processes and products to combat large. Popular experience is expected to guide you in solving the health problem of the United States.” Maintains a “buy” rating and raises its target price from $ 2,500 to $ 2,550. .
Pivotal Research analyst Michael Levine also reiterated Amazon’s “Buy” rating and raised the price target from $ 2,450 to $ 2,700. “Generally speaking, we believe that Covid-19 has driven Amazon Prime to a higher adoption rate, and the physical retail industry is weakening further, and Amazon’s investment in logistics will drive competition and eventually make other competitors not They may be a coincidence, so the small pullback in the stock price will be a great buying opportunity. “
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