Amazon Stock Drops Despite Bullish Views on AWS Growth
Amazon's stock dropped nearly 2% on Thursday, despite positive analyst views on Amazon Web Services (AWS) and AI-driven cloud demand. According to Rosenblatt analyst Scott Devitt, investors undervalue the company's AI opportunity.
Devitt initiated coverage of Amazon with a Buy rating and a $335 price target, expecting AWS growth to reach 45% by the end of 2026, above the Street's 38% estimate. He also projects AWS annual revenue will exceed $335 billion by 2028.
Citizens analyst Andrew Boone reiterated a Market Outperform rating and a $315 price target, pointing to strong growth at OpenAI and Anthropic as a positive indicator for AWS. Boone expects rising AI usage to support cloud infrastructure demand and believes hyperscalers are unlikely to face significant excess server capacity.