AmTech Upgrades Amazon (AMZN) from Sell to Neutral

October 23, 2008 11:38 AM EDT

American Technology Research upgrades Amazon.com (Nasdaq: AMZN) from Sell to Neutral. The firm lowered its price target on Amazon from $45 to $40.

The upgrade is very interesting as AmTech has been a known-bear on the stock for sometime. In fact, the firm has had a Sell rating on Amazon since at least July 22, when it recommended selling the stock before Amazon's Q2 earnings.

AmTech has turned less bearish on shares of Amazon as it feels the company's Q4 guidance for sales of $6-$7 billion, issued yesterday with the company's Q3 results, is "the 'kitchen sink' variety" given "a very wide range that allows for both best and worst case scenarios..." AmTech believes Amazon's Q4 guidance is the "#1 reason" that the stock will remain under pressure in the near-term. Specifically, AmTech says that shares of Amazon could trade down to $30, and "perhaps even lower".

Although the firm is concerned with near-term performance, AmTech calls Amazon "a unique and extremely well-managed franchise that is likely to emerge from the current economic malaise much stronger than when it went in." The firm also believes long-term investors can "start nibbling... at $30."

After opening today's trading session about 13% lower, shares of Amazon have rebounded and are now trading around $47.22, down only about 5.6%.

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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