Oppenheimer bumps Amazon stock target on 'meaningful' 2027 AWS upside

Investing.com -- Oppenheimer raised its 12- to 18-month price target on Amazon to $305 from $290 per share in a note on Monday, citing what it calls “significant upside through 2027” for Amazon Web Services.

Analyst Jason Helfstein reiterated an Outperform rating on the stock, arguing that recently disclosed capacity plans point to much stronger AWS revenue than the market currently expects.

According to Oppenheimer, AWS is “planning to double capacity through 2027 after having doubled since 2022,” with “at least 1GW added in 4Q.”

The firm analysed historical performance and found that Amazon has generated “~$3B historical revenue per incremental GW.”

Helfstein noted that applying that figure to Amazon’s forward capacity forecast, adjusted for pricing discounts, implies material upside to consensus estimates.

Oppenheimer sees “14%/22% upside to Street 2026/2027 AWS revenue, including 3% upside in 4Q.”

The analyst said the findings justify an upward revision to the price target, adding that AWS’s multi-year expansion could continue to be the primary driver of Amazon’s valuation.

The new target “assumes 10x 2027 AWS revenue/5x E-commerce gross profit,” with the AWS trajectory pointing to a valuation “in the mid-$300s.”

The note also flagged the upcoming AWS re:Invent event, which begins on 1 December. Oppenheimer said investors “could see additional announcements,” though such updates “have been less impactful in recent years.”

Beyond cloud, the bank pointed to a more subdued outlook for the company’s retail business. Citing Adobe data, Oppenheimer said holiday sales are forecast to grow 5% year over year, down from 9% in 2024, implying that “investor expectations are already muted.”

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