Telsey Advisory Group analyst Joseph Feldman reiterated an Outperform rating and a $4,000.00 per share price target on Amazon (NASDAQ: AMZN) heading into Q3 earnings later this week.

The analyst expects AMZN to report better-than-expected Q3 sales and profit results amid the current favorable shift toward online, market share gains, elite execution, and strong industry trends.

“We believe Amazon's 3Q21 results should continue to benefit from the growth of its Prime member base (200MM + global members), expansion of its merchandise assortment—including grocery, fashion, private brands, and third-party products—and fast fulfillment. The increased usage of advertising, music, movies, and gaming subscriptions also should help. In addition, Amazon Web Services (AWS) should continue to generate solid results, given the accelerated shift to cloud computing. In our view, these strong structural trends, combined with a healthy consumer spending environment, should fuel growth in 3Q21, despite lapping difficult comparisons,” Feldman said in a client note.

The analyst reiterated his argument that Amazon will continue to benefit from superior execution, which is also seen in leveraging the “sticky” Prime member base.

“Amazon's focus on newer business —grocery, pharmacy, fashion, home, private brands, third-party, same-day/one-day delivery, Amazon Logistics, and telehealth—is making Amazon more valuable. The strong growth and profitability of AWS, as well as new media and advertising offerings, should continue to outperform the company average and support Retail,” Feldman added.

Shares of Amazon are up 2% in pre-open after closing at $3,320.37 yesterday.