Amazon's stock heads for fresh record after analyst upgrade
Amazon.com Inc.'s stock rallied 1.7% in premarket trade, putting it on track to open at another record, after Wedbush Securities upgraded the e-commerce giant, citing significant growth opportunities in its Amazon Web Services, Prime Instant Video and payments businesses. Analyst Michael Pachter raised his rating to outperform from neutral, and boosted his 12-month stock price target to $575, after being at $435 for the past 15 months. Since started reporting on its AWS business as separate segment, he believes it will produce dramatic profit growth in the coming years as operating margins expand. Pachter said the greater-than-expected sales traction from Amazon's Prime Day sales event last Wednesday should help produce faster growth in Amazon Prime, which in turn could add at least $2 billion to revenue from capturing PayPal payments. He also expects Amazon to post better-than-expected second-quarter results, when it reports after Thursday's closing bell. The stock has soared 24% over the past three months through Friday, while the S&P 500 has gained 1.3%.
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