Amazon Stock Could Reach $647.97 by 2031, But Risks Abound
Amazon's stock price has been fluctuating due to its aggressive capital expenditures and potential risks. The company is betting on a capex cycle that could pay off in the long run, but it comes with significant costs. As of now, Amazon trades at $253.71, and its AWS segment has shown remarkable growth, reaching $42.2 billion in revenue in Q2 2026, up 36.7% year-over-year.
The base case model predicts that a $5,000 investment in Amazon stock could be worth around $12,770 by September 2031, with an annualized return of 20.63%. However, the bull and bear cases show significant variations, ranging from $14,653.50 to $7,902 respectively.
The base case is driven by AWS re-acceleration, custom silicon scaling fast, and Amazon's planned $200 billion in capital spending for AI infrastructure by 2026. The company's advertising revenue also grew 26% year-over-year to $19.8 billion in Q2.
However, the bear case exists due to management's candid warnings about cash capex hitting $53.1 billion in a single quarter and trailing-twelve-month free cash flow turning negative at -$7.6 billion. Additionally, reported profits carry a heavy asterisk due to a non-operating gain tied largely to the Anthropic stake.