Amazon(AMZN, Financial)is poised to remain a lucrative investment as it plans to ramp up infrastructure spending next year, according to Bernstein analyst Mark Shmulik. He has maintained an "Outperform" rating on the stock with a price target of $235.
Shmulik was recently interviewed by Yahoo Finance, where he showed a lot of positives for Amazon's future. ”Amazon feels like the name that you can put money to work in and get excited about,” he said. He highlighted AWS Revenue's increased growth rate as the firm headed towards the fourth quarter and further invested in Prime Video at the right time during the holiday season. He also emphasized the strong and increasing core business to set up ‘a very solid 2025' in terms of free cash flows.
However, while noting that Amazon's appetite for spending will only grow as it gears up for a bumper holiday quarter, Shmulik noted that the e-commerce giant has had good returns on its investments, especially in Prime Video, implying that the company has faith in its spending.
Amazon's strong operating financials came in the third quarter last year, when net sales were up by 11% to $158.9 billion, higher than WS's predicted $157.2 billion. These results, alongside the expectation of a positive picture on the fourth-quarter net sales, which may range between $181.5 billion and $188.5 billion, have boosted investors' vivacity.
Specifically, the experts forecast favorable revenue dynamics for AWS and Amazon's advertising business, which is expected to grow rapidly. This optimism is similarly reflected by Cathie Wood's Ark Invest, which has recently upped its exposure to Amazon, which is considered a growth stock.
At this time, Amazon was at $195.78 per share and was up 30.58% for the year, although shares slipped slightly in after-market trading on Monday.
