In a report released yesterday, Justin Post from Bank of America Securities maintained a Buy rating on Amazon, with a price target of $272.00.
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Justin Post has given his Buy rating due to a combination of factors that suggest Amazon is poised for financial improvement. One significant factor is Amazon’s strategic decision to reduce its corporate workforce by up to 30,000 employees, which is expected to result in substantial cost savings. This reduction is part of a broader effort to streamline operations and offset the increased depreciation expenses associated with the company’s AI infrastructure investments.
Additionally, the anticipated headcount cuts are expected to enhance Amazon’s profit margins, potentially contributing a 6% increase to the projected operating income for 2026. The company is also focusing on efficiency gains through the use of AI, which is expected to drive further margin improvements. Moreover, Amazon’s initiatives in automation and inventory management are likely to support continued growth in its retail margins. These strategic moves, alongside the company’s ability to manage costs effectively, underpin the Buy rating.
Post covers the Communication Services sector, focusing on stocks such as Alphabet Class A, Meta Platforms, and Alphabet Class C. According to TipRanks, Post has an average return of 24.0% and a 69.42% success rate on recommended stocks.
In another report released today, UBS also maintained a Buy rating on the stock with a $279.00 price target.