Amazon (AMZN) stock is at record highs after the tech giant gave detailed look at the AI push from its cloud business and announced a record start to online shopping. Amazon stock is ahead more than 40% so far this year.
Still, there are ongoing debates among investors as Amazon seeks to build on its gains. Analysts are debating the position of the Amazon Web Service’s cloud business for artificial intelligence against Microsoft (MSFT) and whether it can keep improving its retail profitability amid a challenge from Walmart (WMT), Temu and Shein.
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AI Strategy, Chips And Cloud Competition In Focus At 2024 AWS Re:Invent
So is Amazon stock a buy? Here’s what to know about recent stock action and news for the tech giant:
Amazon Stock Hits Record High
Amazon stock was pointed higher in premarket trading on the stock market today. That’s after gaining 2.2% to close at 218.16, a record for the $2 trillion tech giant.
Amazon stock gained Wednesday after announcing that Apple (AAPL) is using Amazon’s cloud service and custom chips for some of its AI models. AWS is hosting its annual re:Invent conference, where it clearly stepped up its challenge Nvidia‘s (NVDA) dominance of the AI chip market.
It also likely helped Amazon that the five day shopping window between Thanksgiving and Cyber Monday brought record e-commerce spending by all market estimates.
Amazon stock is now above a 5% buy zone from a 201.20 consolidation pattern entry, according to MarketSurge.
Shares broke out initially past that buy pint on Nov. 6, as part of a broader rally following the election of Donald Trump to a second presidential term. The stock pulled back in mid-November before its recent rally back to record highs.
Amazon’s Relative Strength Rating sits at 85 out a best-possible 99. That means Amazon has outperformed 85% of stocks in the IBD database over the past 12 months. IBD recommends focusing on stocks with at least an 80 RS Rating.
The IBD Stock Checkup tool shows Amazon stock holds an IBD Composite Rating of 94 out of a best-possible 99. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.
Further, Amazon stock holds an Accumulation/Distribution Rating of B. That rating analyzes price and volume changes in institutional ownership for a stock over the past 13 weeks. The current rating indicates more buying than selling by institutions.
Investors also will want to check out IBD’s Big Picture column for the current market direction before considering any buy points. Here is a guide to understanding IBD’s rating system.
Amazon Q3 2024 Earnings
Amazon stock rallied 6.2% to close at 197.93 after reporting third quarter earnings on Oct. 31.
The company beat expectations with a 52% increase in earnings, to $1.43 per share. Sales growth of $158.9 billion, up 11% year-over-year, also beat expectations.
While Amazon’s sales forecast for the current quarter came in lighter than expected, the company’s operating income impressed.
What Analysts Are Saying About Amazon Stock
The thirty-year-old Amazon is among the world’s most valuable companies. It is a leader in e-commerce spending and in cloud-computing through its Amazon Web Services business. It is also quickly growing its advertising business into a challenger to Google (GOOGL) and Meta. Amazon joined the blue-chip Dow Jones Industrial Average earlier this year.
Despite the stock’s strong run to record highs, Wall Street analysts still see room to run for Amazon.
Of the 70 stock analysts following Amazon, 94% have a buy rating, according to FactSet.
As of Thursday, the average target price for Amazon stock from analysts is 235.67, according to FactSet. The average target price implies roughly 8% upside from Amazon’s price as of market close Wednesday.
Recent analyst commentary is focused on AWS and its AI push, following its re:Invent customer conference.
JMP Securities analyst Nicholas Jones, who rates Amazon stock outperform, said the conference offered positives for investors in a client note Thursday.
“Amazon continues to invest in innovation to capture the increasing demand around cloud solutions and AI,” Jones wrote. “Moving forward, we expect investors will remain focused on AWS’ growth trajectory exiting 2024 and into 2025, as well as the magnitude and timing of investments required to capture the growing demand and the corresponding impact to (operating income margin) and capex levels.”
Amazon Market Cap
You can check for Amazon’s current stock price here. Amazon’s market cap was $2.29 trillion, as of Dec. 5. Here is how the stock has grown over time:
| Time Period | Amazon Stock % Gain | S&P 500 % Gain |
|---|---|---|
| Year-to-Date | 43.6 | 27.6 |
| Previous 12 Months | 48.4 | 32.5 |
| Three Years | 28.72 | 34.11 |
| Five Years | 146.51 | 96.77 |
| Since 1997 Amazon IPO | 242,300 | 617 |
*Prices as of Dec. 5.
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