On Friday, Tigress Financial Partners updated its outlook on shares of Amazon.com (NASDAQ:AMZN), raising the 12-month price target to $245 while maintaining a Buy rating on the stock. According to InvestingPro data, Amazon is currently trading near its 52-week high of $233, with the stock showing impressive momentum through a 47% gain year-to-date.
The adjustment reflects the firm's confidence in Amazon's continued growth fueled by its retail prowess and technological innovations, particularly in generative AI and fulfillment operations.
Amazon's recent performance, highlighted by a record-breaking Black Friday Week and Cyber Monday, has reinforced expectations for a robust holiday season. This follows a notable third quarter in 2024, where the company reported an 11% year-over-year increase in revenue, reaching a record $158.9 billion.
With a market capitalization of $2.35 trillion and an overall "GREAT" financial health score from InvestingPro, Amazon continues to demonstrate strong operational execution. The growth was consistent across all business segments, with North American revenue up by 9% to $95.5 billion, and international revenue growing 12% to $35.9 billion.
The company's cloud computing division, Amazon Web Services (AWS), was a standout, with a 19% increase in revenue to $27.5 billion, now boasting a $110 billion annualized run rate. AWS's advancements in AI and machine learning have set it apart, releasing nearly double the features of its closest competitors in the past 18 months.
Advertising revenue also saw a significant uptick, growing by 18.8% year-over-year to $14.3 billion. This growth is attributed to Amazon's ability to attract increased spending from brands aiming to capitalize on its extensive online marketplace and consumer base. Amazon's continuous innovation, including new video generation and live image capabilities for advertisers, positions it as a leader in the industry.
Tigress Financial Partners underscored Amazon's expansion in various sectors, from grocery to cloud services, as a driver for sustained revenue growth. The firm's belief in the company's potential for long-term shareholder value creation is evident in its price target, which suggests a 30% potential return from current levels.
Analyst consensus remains strongly bullish, with price targets ranging from $180 to $285. For deeper insights into Amazon's valuation metrics and growth potential, including 14 additional exclusive ProTips, visit InvestingPro to access the comprehensive Pro Research Report.
In other recent news, Amazon has seen an increase in stock price targets from multiple investment firms, including Canaccord Genuity, UBS, and Jefferies, all maintaining a Buy rating due to the company's growth prospects across various sectors such as eCommerce, cloud computing, and advertising.
Analysts from these firms expect Amazon's revenue growth to be driven by enhancements to Amazon Prime services, increased adoption of Amazon Web Services, and expansion of Amazon's advertising business. They also commend Amazon's efforts to improve profitability through cost reduction measures and the introduction of high-margin revenue streams.
However, the company has also faced labor unrest, with workers at seven Amazon facilities across the U.S. striking, demanding the company engage in contract negotiations with their union, the International Brotherhood of Teamsters. This action followed Amazon's refusal to meet a negotiation deadline set by the union.
The strike authorization vote at two New York City facilities signals escalating tensions between the company and its workers. These are recent developments in the company's financial outlook and labor relations.
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