On October 27th, Amazon.com, Inc. (NASDAQ:AMZN) delivered strong earnings, with a topline that outclassed top analyst Victor Anthony at Axiom’s projections by 1.5% thanks to a robust retail segment coupled with an “in-line” performance from Amazon Web Services (AWS). In reaction, the analyst reiterates a Buy rating on AMZN while lifting the price target from $877 to $953, which represents just under a 21% increase from where the shares last closed.

The online auction and e-commerce leader missed Anthony’s gross margins forecast by 80 basis points (BPS) whereas CSOI margins came up 10 bps short with regards to “stepped-up” investments in digital content, especially when assessing video, as well as India, fulfillment, devices, and AWS. From the analyst’s perspective, margin guidance denotes sustained expectation for higher investment spending. Anthony notes this rise in spending emerges from an investment in original and local content and bolsters the Prime flywheel. Additionally, this year AMZN has plans to add 26 fulfillment centers to its roster, compared to 14 this time last year, and will be launching Prime services in China.

In regards to fortuitous prospects lying ahead, the analyst underscores India as a massive scope for AMZN to explore when considering fundamental ways to drive growth. Anthony explains, “In India, Amazon is investing in an emerging and potentially large opportunity, where already Amazon is the most visited e-commerce website and is the most downloaded e-commerce app. […] For devices, Amazon called out Echo and Alexia. The AWS investment is well understood by investors, we believe, and the potential TAM is enormous.”

Meanwhile, Anthony likes the way Amazon Prime positively charges the leader’s odds when facing off against rivals, with a risk/reward factor in favor of AMZN’s long-term growth possibilities. The analyst asserts, “Video and devices reinforce the Prime value proposition. Prime Now and Fresh are expensive today (& risky) but should give Amazon a competitive edge in the future, and India could become one of Amazon’s largest markets one day. As such, as we are sticking with our bullish view on the stock as we see these investments leading to consistent strong topline growth and longer-term growth in free cash flow.”

“We have been recommending Amazon’s shares for over four years and continue to do so today,” Anthony concludes.

Victor Anthony has a very good TipRanks score with a 64% success rate and he stands at #41 out of 4,178 analysts. Anthony garners 12.8% in his annual returns. When recommending AMZN, Anthony yields 32.7% in average profits on the stock.

TipRanks analytics indicate AMZN as a Strong Buy. Based on 33 analysts polled in the last 3 months, 31 rate a Buy on AMZN, while 2 maintain a Hold. The consensus price target stands at $948.58, marking a nearly 20% upside from where the stock is currently trading.