Amazon Stock Forecast: Earnings and Revenue Insights

Amazon's stock has outperformed the market recently with an 18.9% return over the past month. The analysis highlights crucial earnings projections and revenue growth trends, offering insights into potential stock movements going forward.

Date: 17-05-2025

AI Rating: 7

Overview of Amazon's Performance

Amazon (AMZN) has shown robust performance with an +18.9% return over the past month compared to the S&P 500's +9.8% increase. This trend reflects investor optimism surrounding both earnings estimates and revenue growth. However, a closer examination is warranted.

Earnings Per Share (EPS)

The consensus earnings forecast for the current quarter stands at $1.34, representing an 8.9% year-over-year increase. A slight decline of -1.1% in the estimate over the last 30 days suggests that while projections have trended positively, analysts may be moderating their expectations slightly.

For the fiscal year, expected EPS of $6.30 demonstrates a strong 13.9% year-over-year growth, with a marginal increase of +1% in estimates recently. The next fiscal year indicates another rise to $7.22, maintaining a solid growth expectation of +14.5%.

Revenue Growth

Amazon's revenue projections are equally encouraging, with a current quarter estimate of $161.8 billion—an increase of 9.3%. For the fiscal years ahead, estimates reaching $693.74 billion and $761.45 billion forecast growth rates of +8.7% and +9.8%, respectively. This reinforces the narrative that Amazon is maintaining strong demand and operational capacity to support sustainable revenue growth.

Valuation Metrics

The report indicates a Zacks Style Score of D, suggesting that Amazon's stock is currently overvalued relative to its peers. This might raise concerns among investors looking to enter or hold the stock, as overvaluation can create potential risk if the market corrects.

Conclusion

Overall, while Amazon shows promise in terms of EPS and revenue growth, the downtick in earnings estimates alongside a poor valuation score could temper enthusiasm. A Zacks Rank of #3 (Hold) signifies that performance may align closely with the broader market, suggesting caution but also potential for continued momentum. Therefore, while prospects look promising, investors should weigh the valuation concerns against expected growth.

Stocks: AMZN