Amazon Sees $500 Price Target as AI Supercycle Takes Hold

Morgan Stanley's recent projection suggests Amazon could reach $500 by the end of 2027, primarily driven by an artificial intelligence supercycle within its cloud computing division. The Wall Street giant believes AWS is poised to become a $1 trillion enterprise in the next decade, fundamentally altering the valuation metrics of the Seattle-based technology conglomerate.

The research note, published by analyst Brian Nowak, outlines a scenario where enterprise migration to generative AI workloads accelerates faster than current consensus estimates. Amazon recently increased its 2026 capital expenditure forecast for AI infrastructure to $220 billion, which Morgan Stanley believes will yield compounding returns through AWS.

Morgan Stanley notes that Amazon's custom silicon provides a critical margin advantage over competitors relying exclusively on Nvidia hardware. The firm highlights that AWS is entering a decade-long compute capacity supercycle, wherein legacy enterprises are forced to completely re-architect their data infrastructure to remain competitive.