Goldman Sachs reiterates "Buy" rating on Amazon, target price raised to $290

Goldman Sachs reiterated its "Buy" rating on Amazon (AMZN.US), raising the target price from $275 to $290. The firm expects market focus may shift from Amazon Web Services (AWS) positioning in the AI field to a more stringent review of the consumer environment in the coming quarters.

The firm is optimistic about Amazon in the long term, maintaining a constructive view on its long-term performance, believing that Amazon can achieve compound revenue growth and operating margin expansion over the years while continuing to invest in long-term growth plans.

The firm also believes that Amazon is well-prepared to outperform in the future, based on e-commerce profitability benefiting from higher sales under a more efficient logistics network and declining unit service costs; the advertising business continues to expand under high profitability; and AWS benefiting from structural changes in enterprise customer demand, with generative AI workloads accelerating deployment bringing long-term growth momentum. Whether the company can establish a more stable and regular capital return mechanism will be a variable in the medium to long term