Amazon shares rose as much as 5.6% on Monday and were still up 4.6% at 11:52 a.m. ET, recovering from last week's slump. Phillip Securities analyst Helena Wang upgraded the stock to buy from accumulate and raised her price target to $330 from $320, citing strong demand visibility for cloud services and a growing suite of AI offerings. The stock had fallen after Q3 results, when Amazon reiterated capex plans of $220 billion for 2026, CEO Andy Jassy said spending would be meaningfully higher in 2027, and free cash flow was negative $42 billion. Jassy said the company has 'even more conviction' that these investments will yield a much larger revenue and free cash flow business. The author argues the valuation at 20 times earnings is near an all-time low and rates the stock a buy.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
AMZNcloud computingAI investmentvaluation
Open a keyword to see other news on the same topic.
Related tickers and likely impact
AMZN
▲ Likely positiveAmazon
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | Consumer Discretionary |
| Industry | Broadline Retail |
| Market cap | $2.6T |
| Close on 10/30/2026 | 240.47 |
| Change that session | -1.36% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- Amazon Soars 5% as Phillip Securities Upgrades It to Buy After Earnings Sell-Off
Amazon (AMZN) shares rose 5% after Phillip Securities upgraded the stock to Buy with a 330 USD price target, following a Friday sell-off over AI spending that outpaced cash flow. Phillip analyst Helena Wang pointed to demand visibility: AWS revenue grew 39% to 46.0 billion USD last quarter, backlog reached 578 billion USD, and CEO Andy Jassy projected AWS growth above 40% in both 2027 and 2028. Against this, capital spending has nearly tripled since late 2024 to 77.3 billion USD in the September quarter, leaving trailing 12-month free cash flow at a 42.4 billion USD outflow. Alphabet and Meta face similar cash shortfalls, while Nvidia stands to benefit from the spending. Amazon's forward P/E fell to 24x, its lowest in five years and less than half its five-year average of 49x.
- Amazon Plans to Spend More on AI. Here’s Why the Stock is a Once-in-a-Decade Buy Hiding in Plain Sight.
Amazon reported earnings below estimates and a deeper-than-expected negative free cash flow, while saying it plans to spend “meaningfully more” on AI next year; the stock fell afterward and was down 14% from its August high. AWS revenue grew 39% to $46 billion, and the company kept its capital spending forecast for the year at $220 billion. Trailing 12-month free cash flow was negative $42 billion due to property and equipment purchases. CEO Andy Jassy said AWS, now at a $184 billion annual run rate, could become a trillion-dollar revenue business within five to 10 years; the author argues the worries about AI spending may be overdone and that Amazon is reasonably priced at 30x forward earnings.
- Prediction: Amazon Stock Will Skyrocket After Oct. 29 Thanks to AWS Growth
Amazon shares are up about 8% for the year after rising following Q2 earnings and then slowly selling off, and the author argues the trend could reverse when Amazon reports Q3 earnings on Oct. 29. AWS accounted for 60% of Amazon's Q2 operating income despite making up only 21% of revenue, and its growth accelerated from 24% in Q4 2025 to 28% in Q1 2026 and 37% in Q2. Amazon is spending about $220 billion this year to expand its computing infrastructure. Because gains on its Anthropic investment are booked as profits, the author values the stock on operating income rather than the price-to-earnings ratio, and he is bullish on Amazon's long-term outlook, with AWS expected to take the company to the next level.
- Microsoft vs. Amazon: Is AMZN’s AI Growth Being Undervalued by Investors?
Microsoft (MSFT) and Amazon (AMZN) trade at similar forward P/E ratios of 25.13 and 23.64, but Amazon is using AWS and retail profits to fund an infrastructure buildout that has pushed its free cash flow below zero. In Microsoft's June quarter, revenue rose 18% to $90.0 billion and operating income rose 18% to $40.6 billion, with Azure growing 43%. AWS revenue surged 37% to $42.2 billion in the second quarter, its fastest growth in 18 quarters, and its operating income reached $16.6 billion; AWS generated about 60% of Amazon's operating income from roughly 21% of revenue. Amazon's consolidated operating income grew 43% against 20% revenue growth, which the article presents as evidence of real operating leverage rather than only promised AI revenue.
- Amazon Climbs 5% as Upgrade Fuels Post-Earnings Rebound on AWS Strength; Walmart Rises 2%, Alphabet Edges Higher
Amazon shares rose 5% to $251.77 in morning trading, rebounding from its Q3 2026 report on October 29, which showed EPS of $1.89 against the $1.96 consensus estimate. AWS generated $46 billion in revenue and $17.8 billion in operating income, and CEO Andy Jassy said AWS demand remains 'exceptionally strong' with projected revenue growth above 40% in both 2027 and 2028. Trailing 12-month free cash flow swung to an outflow of $42.4 billion, driven largely by AI investments, and Amazon estimated 2026 capex at $220 billion. JPMorgan analyst Doug Anmuth projects Amazon capex of $395 billion in 2027 and $476 billion in 2028. Walmart rose 2% to $126.29, while Alphabet gained 1% to $283.10 amid concerns about its AI spending and negative free cash flow.
- Amazon Stocks Jump 4.3% With Upgrade Putting AWS Cash Conversion in Focus
Amazon (AMZN) shares rose 4.3% to $250.64 at 9:48 a.m. ET on November 2 after Phillip Securities upgraded the stock from Accumulate to Buy and raised its price target to $330 from $320. In its October 29 results, AWS posted $46 billion in revenue and $17.8 billion in operating income, a 38.7% operating margin, accounting for roughly 63% of group operating income on about 23% of sales. Total revenue was $201.9 billion and operating income $28.1 billion, yet trailing twelve-month free cash flow was negative $42.4 billion. The article says cloud profitability remains substantial, but expansion is consuming cash faster than the business generates it. GuruFocus gives Amazon a GF Score of 95 out of 100, strong on growth and valuation but weaker on financial strength, and the article argues the next cash-flow statement may matter as much as AWS growth.
Related markets
Latest news
- It may take weeks to tally the midterm election results. Here’s why Wall Street isn’t worried.
The article stresses that economic and political uncertainty must be distinguished when assessing markets. It argues that only economic uncertainty really moves the stock market.
- The bond-market rally is defying the typical investing playbook. Here’s why.
The U.S. economy grew at its fastest pace in over five years in the third quarter, according to the Commerce Department's initial GDP reading. Despite a run of robust data, Treasury bonds staged a surprise rally in October.
- Entergy Q3 Earnings Call Highlights
Entergy reported third-quarter adjusted EPS of $1.98, driven by customer growth, hotter weather, industrial sales and record peak demand, and raised the low end of its 2026 adjusted EPS guidance by $0.10. An amended agreement with Google for the West Memphis data-center campus is expected to add at least $500 million in Arkansas customer bill savings, and data-center and industrial load opportunities could total up to 17 gigawatts. Planned 2027–2030 capital spending rose by about $1.5 billion for battery storage, transmission and other growth investments. Chair and CEO Drew Marsh said the results reflected financial, regulatory and operational progress.
- Why Coeur Mining Bears Were Right Before The Drop
Coeur Mining shares lost 25.3% year to date including dividends, against a bullish case built on gold at $4,000, silver at $100, a 30% free cash flow margin and a 10x FCF multiple. The shares started the period at US$17.83; the bullish narrative put fair value at US$21.6 on 51.2% revenue growth and a 9.5% profit margin, while the cautious view set US$13.64 with 14.3% revenue growth and a 33.2% profit margin and flagged regulatory and jurisdictional risk. Q2 2026 revenue reached US$1.09b versus US$480.65m a year earlier, helped by the New Gold acquisition, and net income rose, but the net margin fell from 14.7% to 11.2%. The shares now trade at US$13.1, and the selected narrative assumes production growth, cost discipline and asset integration will sustain revenue and margin strength. The article concludes that the original thesis depended heavily on margins, not just metal prices or output.
- Bitcoin ETF outflows hit $643M, led by BlackRock and Fidelity
Bitcoin ETFs saw net outflows of $643 million on Friday, led by BlackRock at $233.7 million, followed by Fidelity at $201 million and Arc B at $129.5 million. The funds had also recorded net outflows in each of the four preceding sessions, and the week was still only down $202 million. The host notes that ETF flows tend to react to market moves because these funds don't trade 24/7 like Bitcoin, so the impact of after-hours events often shows up the next day. He contrasts this with the worst hack in history, worth $6 billion, and a sharp tech sell-off in which Intel fell 30% and Alphabet and Amazon were each down about 12% at one point overnight, while Bitcoin fell only 4–5% and gold also declined.
- BetterInvesting™ Magazine Update on Amazon.com and UnitedHealth Group
BetterInvesting Magazine's committee named Amazon.com (NASDAQ: AMZN) its “Stock to Study” and UnitedHealth Group (NYSE: UNH) its “Undervalued Stock” in the January–February 2027 issue, for informational and educational use. The organization says these picks are not endorsed or recommended for purchase by NAIC/BetterInvesting. It urges investors to conduct their own review using the Stock Selection Guide before making any investment decision. Non-members can access a limited trial version of the online analysis tools to view fundamental data for both companies.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.