Amazon Valuation Questioned Amid AI Infrastructure Boom

The U.S. is experiencing a historic surge in AI infrastructure expansion, with nearly 90 large-scale data centers exceeding 100 megawatts currently operational and projections estimating around 280 by 2030.

This growth is fueled by an anticipated $7 trillion investment in data centers, with Amazon.com Inc (NASDAQ: AMZN), Microsoft, and Alphabet collectively signing over $1.5 trillion in data center leases since the AI boom began.

Amazon's current Price-to-Sales ratio of 3.62 is slightly above its historical median of approximately 3.44, signaling that the market prices in continued strong revenue growth; however, earnings-based valuation metrics like P/E are less relevant given the company's cash flow challenges.

GuruFocus' proprietary GF Value metric estimates Amazon's intrinsic value at $247.71 per share, indicating the stock is about 4.4% overvalued relative to its current price of $258.51.