Bank of America resets Amazon stock price target before earnings

Amazon (AMZN) banal has gained astir 5.3% implicit the past 5 days, astatine the clip of writing, Tuesday afternoon, Jan. 27, according to Yahoo Finance. The institution has acceptable a Q4 net merchandise for February 5, and investors are hoping it volition bushed statement estimates, arsenic it did successful Q3.

I covered Q3 results successful my nonfiction “Bank of America resets Amazon banal terms aft net smasher.”

Other factors are helping the stock, too.

“Now, arsenic aboriginal arsenic Tuesday adjacent week, Amazon volition reportedly denote the 2nd circular of its broader layoff plan; the fig is expected to beryllium the aforesaid arsenic successful October: 14,000. This tin interaction employees crossed its Prime Video, quality resources, and Amazon Web Services units,” writes Aparajita Chatterjee for TheStreet.

On apical of layoffs, AWS scored a $581 cardinal woody from the U.S. Air Force’s Cloud One Program.

Bank of America expert Justin Post and his squad updated their Amazon banal outlook up of earnings.

Analysts estimation Amazon's Q4 gross and EBIT astatine $213 cardinal and $26.0 billion, respectively, which are supra Wall Street's estimates of $211 cardinal and $24.6 billion.

They expect 22% year-over-year AWS gross maturation arsenic greater capableness drives incremental sales. Analysts noted that Amazon CEO Andy Jassy's caller interrogation with The Information suggests request inactive outstrips capacity, which is simply a affirmative for pricing.

Related: Bank of America resets Meta banal forecast earlier earnings

Post said Q1 margins should payment from Q4 layoffs. For Q1, the squad estimates unchangeable retail growth, portion incremental capableness should enactment AWS acceleration. They expect Q1 Amazon gross guidance to beryllium successful the scope of $173 cardinal to $178 billion, and operating income successful the scope of $18.5 cardinal to $22.5 billion.

They noted that Amazon usually beats Q1 guidance, and a Q4 bushed could thrust upside to the Q1 ranges.

In a probe enactment shared with me, Post reiterated a bargain standing and lowered the people terms from $303 to $286, owed to bundle arsenic a work assemblage aggregate compression.

The people terms is based connected his sum-of-the-parts investigation that values AWS astatine 9x 2027 sales, first-party retail astatine 1.1x, third-party retail astatine 2.5x, and advertizing astatine 5.0x. Post’s terms people implies a 3.5 times blended price-to-sales ratio, 12 times 2027 EBITDA, and 31 times 2027 EPS.

• Increasing contention from offline and section retailers

• AWS lawsuit outgo optimization interaction connected revenues and margins

• Regulatory unit connected the third-party marketplace

They besides noted that the banal has been taxable to dense volatility successful the past, based connected borderline trends, and this volatility could summation owed to economical uncertainty.

AWS launched AWS European Sovereign Cloud, a new, autarkic unreality for Europe wholly located wrong the EU, and physically and logically abstracted from different AWS Regions.

According to the company, the AWS European Sovereign Cloud provides the lone afloat featured, independently operated sovereign unreality backed by beardown method controls, sovereign assurances, and ineligible protections designed to conscionable the needs of European governments and enterprises for delicate data.

AWS plans to grow its AWS European Sovereign Cloud footprint from Germany crossed the EU, starting with caller sovereign AWS Local Zones successful Belgium, the Netherlands, and Portugal.

“Europe needs entree to the astir robust unreality and AI technology. The enlargement of AWS innovation crossed Europe volition assistance supercharge customers’ maturation and AI ambitions,” said Stéphane Israël, managing manager of the AWS European Sovereign Cloud and integer sovereignty.

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LSEG, a planetary fiscal markets infrastructure and information provider, announced it volition collaborate with AWS. The institution sources and distributes marketplace information from implicit 575 exchanges and trading venues to customers worldwide, delivering hundreds of billions of information updates each day.

LSEG volition beryllium leveraging AWS’s services successful the collection, routing, and organisation of its Real-Time fiscal data. This concern volition leverage LSEG’s backstage unreality and alteration fiscal institutions to entree its marketplace information with greater flexibility, speed, and resilience.

Ron Lefferts, Co-Head of Data & Analytics, LSEG, said: “LSEG’s real-time information and feeds is simply a important constituent of our concern and this collaboration is portion of our unreality translation strategy. Advances successful AI and different technologies mean that request for information is accelerating rapidly. This is simply a cardinal translation of our captious information offering that powers the fiscal markets."

Infosys (INFY), a integer services and consulting firm, entered into a concern with AWS. The 2 companies are combining Infosys Topaz, an AI-first acceptable of services, solutions, and platforms powered by gen AI, with Amazon Q Developer, AWS’s gen AI assistant.

Infosys Topaz is designed to heighten productivity successful bundle development, HR, recruitment, sales, and vendor management.

The institution provides an illustration of how, successful the bundle improvement lifecycle, integrating Infosys Topaz with Amazon Q Developer enables automated documentation and provides tailored enactment for tasks specified arsenic codification generation, debugging, testing, and bequest codification modernization, importantly enhancing workflow ratio and accuracy.

Overall, Amazon shareholders volition privation to spot the institution overdeliver on:

• Q4 revenue, expected by BofA to beryllium $213 billion. Wall Street is modeling $211 billion.

• Q4 EBIT: BofA estimation is $26. Wall Street expects $24.6.

• Q1 gross guidance, BofA expects successful the scope $173 cardinal to $178 billion. Wall Street is targeting $175.4 billion.

The writer holds nary presumption successful AMZN astatine the clip of writing.

Related: Bank of America resets Intel banal forecast

This communicative was primitively published by TheStreet connected Jan 28, 2026, wherever it archetypal appeared successful the Investing section. Add TheStreet arsenic a Preferred Source by clicking here.