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Amazon (AMZN) reported Q1 EPS of $2.78, crushing the $1.73 estimate, with revenue at $181.5B (up 16.61%), AWS reaccelerating to 28% growth (its fastest pace in 15 quarters), and custom chips reaching a $20B run rate with triple-digit growth.
24/7 Wall St. has a 12-month price target of $320.08 (20.76% upside) with a buy rating at 90% confidence.
AWS capacity commitments from OpenAI (2 GW), Anthropic (5 GW), and over 1 million NVIDIA GPUs in 2026 provide multi-year demand visibility, but capital intensity remains a risk with Q1 capex up 77% to $44.2B and full-year 2026 capex guided near $200B.
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Amazon delivered a clean earnings report, and our model leans into the strength. Amazon (NASDAQ:AMZN) trades at $265.06 after rising 27.27% over the past month, but our proprietary work suggests the rally has room.
Our 24/7 Wall St. price target is $320.08 over the next 12 months, implying 20.76% upside. The recommendation is buy with 90% confidence.
Amazon shares are up 14.83% year to date and 43.73% over the past year, near the 52-week high of $265.91. The Q1 2026 report on April 29 was the catalyst. EPS of $2.78 beat the $1.73 estimate, revenue grew 16.61% to $181.519 billion, and AWS reaccelerated to 28% growth, its fastest pace in 15 quarters.
Advertising crossed $70 billion in trailing twelve-month revenue, custom chips topped a $20 billion run rate growing triple digits, and Stores unit growth hit 15%, the highest since COVID lockdowns ended. The April 21 announcement of an additional $25 billion Anthropic investment tied to a 5GW compute commitment flipped retail sentiment from bearish to bullish in roughly two weeks.
Bulls have real runway. The OpenAI commitment of 2 GW of Trainium capacity beginning 2027, Anthropic's 5 GW commitment, and over 1 million NVIDIA GPUs deploying in 2026 lock in multi-year AWS demand visibility.
Analyst sentiment supports this: 65 buy or strong buy ratings versus 4 holds and zero sells. Our bull case points to $371.56 by May 2027, a 40.18% total return, achievable if AWS holds 28%-plus growth and advertising sustains 24% momentum.
The bear case centers on capital intensity. Q1 capex hit $44.203 billion, up 76.68% year over year, and full-year 2026 capex is guided near $200 billion. TTM free cash flow collapsed 95% to $1.2 billion and long-term debt nearly doubled to $119.1 billion.
AWS operating margin slipped to 37.7% from 39.5% from a year prior. Net income of $30.255 billion was inflated by a $16.80 billion Anthropic mark-up that won't recur.
Bulls argue FCF compression reflects voluntary investment in capacity backed by signed customer commitments. Polymarket traders are more cautious than analysts, with composite prediction sentiment at 36.66. A bear case lands AMZN at $273.70 by May 2027 if tariffs and recession fears drag spending.
The 24/7 Wall St. price target of $320.08 with buy and 90% confidence is anchored by AWS reacceleration and custom silicon that competitors can't replicate quickly.
The bull thesis strengthens if Q2 operating income lands above the $24 billion high end. The thesis weakens if AWS growth slips below 22% or 2026 capex blows through $210 billion without commensurate revenue commitments.
Our model projects Amazon's trading range in coming years, assuming current growth trajectories hold.
These projections assume Amazon executes on AWS, advertising, and custom silicon. Significant upside or downside could result from Anthropic and OpenAI capacity ramps, Amazon Leo's commercial trajectory, or recessionary pullback in enterprise IT spend.
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