Axiom analyst Victor Anthony came out with a favorable research report on, Inc. (NASDAQ:AMZN) after the firm reworked its Amazon Web Services (AWS) estimates which come from the company’s first quarter earnings. Anthony maintained a Buy rating on the stock and raised the price target from $460 to $500, which implies an upside of 12.1% from current levels.

Anthony wrote, “We agree that the opportunity is big, and high customer switching costs and a high level of service coupled with affordable prices make AWS very competitive in an increasingly competitive space. All that we have seen and heard from customers over the years suggests that a credible case can be made that AWS will not only sustain its market share but also potentially increase it.”

“However, we do expect margins to increase modestly over time – we forecast a 300bps EBITDA margin expansion from 2014 to 2017 as AWS gains leverage on opex, with the caveat being how aggressive Amazon gets with future price cuts.”, the analyst continued.

Bottom Line: “Recent talk of a spin-off of AWS is probably premature as we believe Bezos is unlikely to do so, at least any time soon. Nonetheless, we think bulls could continue to hold onto a spin as a future option to enhance shareholder value.”

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Victor Anthony has a total average return of 17.4% and a 70.3% success rate. Anthony has a 20.7% average return when recommending AMZN, and is ranked #73 out of 3640 analysts.

Out of 40 analysts polled by TipRanks, 26 rate AMZN stock a Buy, and 13 rate the stock a Hold, whereas only 1 recommends a Sell. With an upside potential of 5.94%, the stock’s consensus target price stands at $471.92.