Amazon: Buy Rating Backed by Near-Term Earnings Upside and AWS-Driven Re-Rating Potential

Bank of America Securities analyst Justin Post has reiterated their bullish stance on AMZN stock, giving a Buy rating yesterday.

Justin Post has given his Buy rating due to a combination of factors that point to both near-term upside and longer-term re‑rating potential. He expects Amazon’s fourth-quarter revenue and operating profit to come in ahead of consensus, driven by accelerating AWS growth and slightly stronger-than-anticipated North America retail performance. The firm’s proprietary card data suggests stable online spending and continued market share gains for Amazon, while efficiency gains, lower fuel costs, and solid advertising trends are expected to support margin expansion. In addition, anticipated 1Q guidance ranges are seen as broadly in line with, or slightly better than, Street expectations, with Amazon’s history of outperforming its own guidance adding an extra layer of confidence.
Post also argues that Amazon’s current valuation does not fully reflect the company’s improving fundamentals, particularly within AWS. After a period of investor concern about Amazon’s AI positioning and relative cloud growth, AWS is entering 2026 with stronger capacity, which he believes should underpin faster growth and better sentiment around the platform. He sees scope for the stock’s multiple to expand as AWS accelerates and AI-related perceptions improve, especially given Amazon’s valuation discount versus its historical P/E. Even after trimming his price objective to $286 (primarily due to sector-wide multiple compression in SaaS), Post values AWS at a premium sales multiple and maintains that the risk‑reward remains attractive at current levels.

In another report released yesterday, Phillip Securities also maintained a Buy rating on the stock with a $290.00 price target.