Auburnheimer: Amazon department profit margin will increase, raising Amazon's target price to $200.
Investment bank Oppenheimer has released a research report, raising Amazon's target price from $170 to $200. It is expected that the profit margins of Amazon's e-commerce and AWS departments will increase, providing the company with greater room for development. In recent years, Amazon has been focused on cost reduction and enhancing its artificial intelligence capabilities, successfully navigating challenges with the help of its cloud computing division, AWS.
Zhitong App learned that investment bank Oppenheimer has released a research report, raising the target price of Amazon (AMZN.US) from $170 to $200.
With a market value of over $1.5 trillion, Amazon has been focusing on cost reduction, enhancing artificial intelligence games, and may overcome challenges through its cloud computing division AWS. Therefore, Oppenheimer believes that the company still has greater room for development.
Despite a 70% increase in Amazon's stock price so far this year, Oppenheimer still considers it a top large-cap stock for 2024, as the company expects profit margins for e-commerce and the AWS division to rise.
As Amazon's delivery network becomes more efficient, the profit margin of e-commerce is bound to expand. With the significant increase in valuations of high-growth software companies, Oppenheimer has also raised the price-to-earnings ratio for AWS's 2024 revenue expectations from 8 times to 10 times.
Oppenheimer stated that the Cyber Week in November this year was the strongest ever. Oppenheimer pointed out that average spending data tracked by Adobe, Salesforce, and Shopify showed an acceleration compared to last year.
Oppenheimer also stated that Amazon has been committed to improving profit margins and expects pre-tax profits per employee to be $89,000 in 2023, compared to $33,000 in 2022.
In recent years, against the backdrop of rising interest rates, inflation, and regulatory concerns at home and abroad, Amazon's strong strength and durability have been tested.