Amazon Upgraded, Target Set at $100

Susquehanna Financial analyst Marianne Wolk Wednesday morning raised her rating on Amazon.com (AMZN) to Positive from Neutral, setting a $100 price target on the stock. Yesterday, AMZN closed at $75.63.

Wolk contends that the company is likely to beat its financial guidance for Q2, given solid execution, ongoing share gains and a weaker dollar. She notes that the company had forecast Q2 revenue of $4.3 billion to $4.75 billion, or 6%-17% growth year over year, though even the high end would be down sequentially from Q1.

Wolk says the company blamed the conservative forecast on currency factors and a tough comp. But she thinks the outlook is too conservative: she notes that currency should actually be a positive factor on a sequential basis. And she says that Amazon is gaining share in the e-commerce sector - and that online retailing in general is taking business away from offline retailers.

Wol also thinks the company will continue to gain traction in new categories; she is particularly bullish about the company’s digital strategy, “which could lead to solid gains in media revenue even as the company focuses on newer categories.

AMZN Wednesday is up $1.39, or 1.8%, to $77.02.

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Comments

[mdtrader:]

You have to laugh at these analysts. They never cease to amaze me, whether it's dot com stocks, house prices, mortgage paper, it really doesn't matter. Keep buying and disregard the valuation. It's this attitude and the inability to correctly value assets and risk, that has helped to create the fiscal mess, we are now in.

How about some good old fashion fundamental analysis where stocks trade on sensible PE's? Now there's a thought.

seekingalpha.com/insta...

MD

Jul 08 11:57 AM

[User 443451:]

What the analysts are trying to tell you is where the stock could be by a certain date, not whether or not it is worth the price. Stop carping about PE ratios - buy it or don't.

Jul 08 06:29 PM

[David Tsao:]

They will increase market share and revenues. However, their margin picture won't change any time soon. The analysts will continue to focus on revenue growth and their digital strategy. No one can break out how much their digital strategy is bringing in to the bottom line except for the people that work at Amazon.

Margin growth is the only thing that should be propping up their current share price, and that growth isn't going to happen for a while.

Jul 09 09:30 AM