Amazon (AMZN) has agreed to buy satellite operator Globalstar (GSAT) in a deal valued at about $11.6 billion. The acquisition is already drawing bullish analysts’ reactions. Citi’s analyst Ronald Josey reaffirmed his Buy rating on AMZN stock at a price target of $285, implying an upside of 14.45%. Meanwhile, Loop Capital also reiterated its Buy rating, citing similar optimism around the deal’s long-term potential.
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New trading tool for AMZN bullsFor context, Globalstar’s acquisition is expected to strengthen Amazon’s low-Earth-orbit satellite network, known as Project Leo, and improve its ability to compete with Elon Musk’s SpaceX and its fast-growing Starlink service. The deal is expected to close in 2027, pending regulatory approvals.
Citi Stays Bullish on AMZN Stock
Josey said the Globalstar acquisition could help accelerate Amazon’s low-Earth-orbit (LEO) satellite plans. He believes the deal will strengthen Amazon’s technology capabilities and expand its product offerings.
Notably, the Globalstar acquisition will give Amazon access to existing satellite spectrum and infrastructure. This means Amazon can build and expand its satellite network faster instead of starting from scratch. It also strengthens the quality and reach of its connectivity services, which is important for delivering reliable direct-to-device internet.
Loop Capital Reaffirms Buy on AMZN
Loop Capital kept its $360 price target on AMZN stock with a Buy rating. The firm believes the satellite broadband investment had previously weighed on retail margins, and upcoming changes in how costs are accounted for could ease that pressure.
Loop also said the expected SpaceX IPO may bring more attention to Amazon’s satellite ambitions. It also pointed to strong demand signals for ChatGPT on Amazon Bedrock as a positive for AWS. For context, Amazon Bedrock is a managed AI platform from Amazon Web Services (AWS).
The firm added that recent disclosures from Amazon’s CEO letter, including updates on AI chips and AI services revenue, support its view that AWS growth could continue to accelerate as more capacity comes online.
What Is the Price Target for AMZN Stock?
According to TipRanks, AMZN stock has a Strong Buy consensus rating based on 42 Buys and three Holds assigned in the last three months. At $284.76, the Amazon average share price target implies an upside of 14.35% from the current level.
