Amazon (AMZN) PT Lifted to $650 at RBC Capital
RBC Capital analyst Mark Mahaney reiterated an Outperform rating and boosted his price target on Amazon (NASDAQ: AMZN) to $650.00 (from $500.00) following materially stronger than expected Q2 results.
Keys to the quarter, according to Mahaney: 1)Revenue Growth Acceleration… The Media, Electronics & General Merchandise, and AWS segments accelerated, thanks to continued Prime adoption, selection improvements, continued share gains and on relatively flat comps (ex-AWS); 2)Record High Gross Margin…expanding 390 bps Y/Y to 35%; 3)Highest Q2 Operating Margin in Five Years…; 4)Solid Metrics– 22% Unit Growth, 14% Active Customer growth to 285MM; 5)Very Good FCF-- $4.4B on a TTM basis, up 321% Y/Y.
The firm's 2016 Revenue estimate increases by 5% to $129B, while Operating Income estimate increases by 26% to $6.4B. They said this may still be conservative.
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Shares of Amazon.com closed at $482.18 yesterday.