Wedbush has reiterated an Outperform rating on Amazon.com (NASDAQ: AMZN) and maintained a $340.00 price target as the company approaches its fourth-quarter earnings announcement, scheduled for Thursday, February 5.
The research team at Wedbush identified 2026 as a potentially pivotal year for Amazon Web Services, which it views as a principal driver of upside to the stock through the year. Wedbush said investor sentiment has been improving after Amazon’s stronger-than-expected showing in the prior quarter, and that momentum in AWS demand is a central element underpinning the firm’s view.
Wedbush noted that AWS growth outpaced expectations last quarter. The firm pointed to implied demand strength reflected in backlog increases and cited the prospect of additional supply coming online over the next twelve months. According to Wedbush, another quarter of robust AWS revenue growth combined with favorable feedback from partners could create conditions for multiple expansion in subsequent quarters.
On fundamentals, Wedbush raised its internal estimates for Amazon. The firm now projects fourth-quarter operating income of $25.2 billion, which it calculates as an 11.8% operating margin and describes as roughly 1% above consensus. For the full fiscal year, Wedbush’s operating income forecast stands at $103.0 billion, equivalent to a 12.8% operating margin.
Valuation remains a focal point for Wedbush’s assessment. The firm observes that Amazon’s shares are trading at about 22 times its 2027 GAAP EPS estimate, a multiple that Wedbush characterizes as offering an attractive risk-reward profile ahead of the earnings release.
Other brokerages have retained or adjusted their stances in advance of the report. Benchmark reiterated a Buy rating with a $295.00 price target. Evercore ISI maintained an Outperform rating and cited momentum in grocery sales, attributing some of that progress to expanded delivery options and a clearer presence through Whole Foods Market. KeyBanc raised its price target to $308.00, reflecting higher revenue and earnings per share forecasts for 2026 and 2027 and anticipating meaningful AWS growth. Stifel updated its price target to $300.00 while keeping a Buy rating and pointing to advertising strength.
Wedbush’s reiteration came after Amazon announced plans to close certain Amazon Fresh and Amazon Go storefronts in favor of other growth priorities, a strategic move the firm referenced in its note. Across the analyst community, the range of targets and recurring emphasis on AWS and advertising underline a focus on both cloud services and monetization of customer reach as drivers of near-term performance.
With the earnings report imminent, Wedbush is signaling that continued AWS momentum and confirmation of elevated demand could be decisive in shaping investor expectations and valuation. The firm’s updated operating income forecasts and commentary on backlog and supply trajectories represent the core data points supporting its Outperform call and $340.00 target.
What to watch on earnings day
- Top-line and operating income relative to Wedbush’s $25.2 billion Q4 operating income projection.
- Any commentary on AWS demand, backlog trends, and timing for incremental supply additions.
- Updates on retail-related strategy and advertising performance that could affect near-term revenue composition.