Amazon (AMZN) PT Raised to $465 at Baird; Robust AWS Margins Stole the Show
Baird analyst Colin Sebastian reiterated an Outperform rating and boosted his price target on Amazon.com (NASDAQ: AMZN) to $465.00 (from $425.00) following Q1 results which he said showed a surprise beat on both revenue and CSOI, and robust AWS margins that stole the show.
Sebastian commented, "Sentiment surrounding AWS profitability was decidedly negative heading into the print, particularly given 2014 price-cuts and the intense competitive environment, yet the~17% operating margin on $1.55B of revenue (+49% Y/Y) exceeded even our above-consensus expectations for modest profitability. While the implied lower Retail/Media margins may give investors pause, incremental North American retail margins (~8%) indicate potential for healthier long-term segment profitability."
The firm lifted FY 2015 EPS from $0.32 to $0.96 and FY 2016 EPS from $1.78 to $3.26.
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Shares of Amazon.com closed at $389.99 yesterday.