Piper Jaffray Cuts Price Target on Amazon.com (AMZN) to $65

October 9, 2008 1:58 PM EDT

Piper Jaffray lowers its price target on Amazon.com (Nasdaq: AMZN) from $80 to $65 and maintains its Neutral rating.

Although the firm is anticipating a slowdown in ecommerce spending next year, Piper says that it remains confident that Amazon will meet the Street's Q3 estimates. The firm is currently estimating Amazon will report Q3 sales growth of 31%, but following the September results, Piper believes the environment will get more challenging amid "accelerating headwinds to consumer spending including weakening wage growth, increasing job losses, contracting consumer credit, and declining household net worth."

The firm maintains its FY08 EPS estimate of $1.52, which compares to the Street estimate of $1.55. For FY09, Piper lowered its EPS and sales estimates on Amazon from $2.12 and $25.051 billion to $1.97 and $25.035 billion, respectively. The Street is currently estimating FY09 EPS of $2.08 and sales of $24.51 billion.

Over the longer-term, Piper believes Amazon is "the best ecommerce story on the internet, gaining share from both offline and online competitors such as eBay (Nasdaq: EBAY). Further, the firm says Amazon's stock will likely rebound as overall consumer spending returns to less depressed levels.

Amazon.com, Inc. operates retail Web sites, as well as provides programs that enable third parties to sell their products on its Web sites in North America and internationally.

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