Amazon Shares Undervalued Despite Strong Earnings

Amazon's shares have slipped 7.33% over the past month, but analysts remain bullish on the company's future growth prospects.

AWS, Amazon's cloud computing arm, posted its fastest revenue growth in 18 quarters in Q2, reaching $42.2 billion and exceeding expectations by 36.7% year-over-year.

The central estimate for a $10,000 stake in Amazon by 2031 is $22,270, assuming AWS continues to accelerate and heavy AI spending pays off.

However, the company's capital expenditures are expected to reach $200 billion in 2026, which could put pressure on returns if AI demand cools before new data centers start earning money.