Amazon: Multi-Year Growth Machine

AMZN

Amazon’s (AMZN) latest blowout earnings saw the e-commerce giant crossing the $100 billion quarterly revenue threshold for the first time. There was growth across all business segments with several records broken in the process. The forward charge is not about to slow down anytime soon, says Tigress analyst Ivan Feinseth.

“AMZN will continue to see significant growth across all of its business lines,” the 5-star analyst said. “AMZN’s industry-leading positions in critical areas, along with its innovative ability, will further drive increasing Economic Profit that will continue to drive greater shareholder value creation. We believe significant upside exists from current levels and continue to recommend the purchase.”

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Amazon has many growth drivers right now:

The list should probably start off with Amazon’s AWS (Amazon Web Services), the world’s largest cloud service provider, which Feinseth says will continue to be a “powerful growth catalyst.”

The service is constantly bringing in new customers and seeing “increasing enterprise adoption.” Some recent marquee client wins include MercadoLibre, Metro Goldwyn Mayer, Standard Chartered Bank and Arm Holdings.

The service keeps adding new offerings, too.

Toward the end of last year, AWS launched the cloud-based health data analytics product Amazon HealthLake, while five new powerful machine learning services were added to AWS’s growing list of AI capabilities.

The upcoming rollout of 5G networks and the continuous rise of Edge computing, will “continue to drive further AWS growth,” Feinseth adds.

Elsewhere, the ongoing development of Alexa, smart devices, and autonomous technology, creates “investment optimality potential.”

New Alexa features, including the addition of multilingual capabilities, and the Alexa Routines features on Fire TV could further add to the 70% of market share in the smart speaker and voice home control technology segment.

Furthermore, with a monthly active user base over 50 million, AMZN’s Fire TV continues to see “accelerating momentum,” as new content gets added via deals with leading streaming providers.

The list goes on… Medical service platform Amazon Care, fulfillment services to other retailers, Amazon Pharmacy and a minority investment in EV truck maker Rivian, are just some of the other initiatives which will continue to propel Amazon forward.

Unsurprisingly, Feinseth has a Buy rating on AMZN shares, although the analyst has no fixed price target in mind.

Feinseth’s glowing Amazon review is par for the course among Wall Street analysts. All current ratings – 32, in total – recommend the stock as a Buy. The Strong Buy consensus rating is backed by a $4,104.23 average price target, suggesting upside of 25% over the next 12 months.

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