Amazon's Stock Drops Amid Bullish Views on AWS and AI

Amazon's stock fell nearly 2% on Thursday as it trailed both the broader market and its sector, despite analysts' bullish views on Amazon Web Services (AWS) and AI-driven cloud demand.

Rosenblatt analyst Scott Devitt initiated coverage of Amazon with a Buy rating and a $335 price target. He believes investors undervalue the company's AI opportunity and expects AWS growth to reach 45% by the end of 2026, surpassing the Street's estimate of 38%. Additionally, he projects AWS annual revenue will exceed $335 billion by 2028.

Citizens analyst Andrew Boone also reiterated a Market Outperform rating and a $315 price target. He points to strong growth at OpenAI and Anthropic as a positive indicator for AWS and expects rising AI usage to support cloud infrastructure demand.

Amazon shares continued to underperform despite the Nasdaq's 1.01% gain and the S&P 500's 0.59% rise. The Consumer Discretionary sector fell 0.7%, but Amazon trailed its peers.