Amazon.com Downgraded by Zacks Research Amid Concerns Over AWS Resilience
Amazon.com (NASDAQ:AMZN) has been downgraded by analysts at Zacks Research from a 'strong-buy' rating to a 'hold' rating in a recent research report. This downgrade comes despite positive sentiment surrounding Amazon's large AI infrastructure commitments, which are expected to support AWS growth. The company has reportedly made significant investments in cloud and artificial-intelligence infrastructure, including a potential $60 billion purchase of Qualcomm AI chips.
However, the downgrade also follows negative news regarding AWS's inability to restore access to damaged facilities in Bahrain and the UAE. This loss of access has raised concerns about service resilience, customer retention, potential costs, and reputational damage. Analysts remain broadly optimistic about Amazon's prospects, with no sell ratings on the stock.
The downgrade by Zacks Research is a notable development for Amazon investors, who have been following the company's progress in the AI space. The stock has a market cap of $2.68 trillion and a PE ratio of 19.99. Analysts anticipate that Amazon will post $8.05 earnings per share for the current fiscal year.