This afternoon, Amazon.com, Inc. (NASDAQ:AMZN) reported solid third-quarter earnings results that largely beat consensus expectations, and issued positive guidance. Accelerating growth in core retail drove revenue outperformance, while declining retail operating margins were offset by a significant expansion in AWS margins and accelerating growth in high-margin Other revenues (e.g., Advertising).
Revenue in the three months ended in September rose 34%, year over year, to $43.7 billion yielding EPS of $0.52. Analysts had been modeling $42.19 billion and $0.03 per share in earnings.
Looking ahead, the company sees 4Q revenue of $56 billion to $60.5 billion, and operating income of $300 million to $1.65 billion. That compares to consensus for $54.2 billion in revenue and $1.5 billion in operating income.
Amazon’s AWS cloud computing unit saw sales rise 42%, to $4.58 billion, beating consensus estimates of $4.52 billion.
On the ratings front, Amazon has been the subject of a number of recent research reports. In a report issued on October 24, Deutsche Bank analyst Lloyd Walmsley maintained a Buy rating on AMZN, with a price target of $1192, which implies an upside of 22% from current levels. Separately, on the same day, Cantor’s Martha Lepczyk maintained a Buy rating on the stock and has a price target of $1150.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Lloyd Walmsley and Martha Lepczyk have a yearly average return of 13.7% and 0.0% respectively. Walmsley has a success rate of 66% and is ranked #415 out of 4700 analysts, while Lepczyk has a success rate of 50% and is ranked #3330.
Sentiment on the street is mostly bullish on AMZN stock. Out of 32 analysts who cover the stock, 30 suggest a Buy rating and 2 recommend to Hold the stock. The 12-month average price target assigned to the stock is $1204.70, which represents a potential upside of 23% from where the stock is currently trading.