Morgan Stanley Signals Bullish Outlook for Amazon as Tariff Cuts Pave Way for 35% Price Surge Potential

In a development that could excite stock traders, analysts at Morgan Stanley suggest that a reduction in tariffs could lead to a significant upswing for Amazon.com Inc. (NASDAQ: AMZN). The firm's analysts have increased their price forecast for the e-commerce powerhouse from $250 to $300, implying a potential increase of approximately 35% from its current market price. This optimistic projection comes on the heels of a recent performance where the stock has already appreciated more than 20% in the last three months, outpacing the S&P 500's growth of 17% during the same timeframe.

Brian Nowak, the lead analyst on this coverage, pointed out that the overall economic environment has notably improved since April. Back then, the Trump administration's announcement of a steep 145% tariff on Chinese imports had clouded growth expectations for the retail giant. With tariffs now reduced to 55%, Morgan Stanley is revising its earnings estimates upward, reflecting a more favorable outlook.

The firm has increased its earnings forecasts for Amazon by 9% for fiscal 2026 and 6% for fiscal 2027. Nowak highlights the potential for accelerated growth in Amazon Web Services (AWS) due to eased supply constraints and a notable uptick in contributions from Anthropic, a key player in the AI arena. According to him, this could mean that Anthropic's revenue contributions to AWS might all but triple over the next couple of years, potentially reaching $10 billion in '26 and $19 billion by '27, assuming the company operates at 60% gross margins.

Traders should be aware that the general sentiment surrounding Amazon remains bullish. A staggering 70 out of 73 analysts covering the stock have assigned either a strong buy or buy rating, further bolstered by a consensus price target of around $245, suggesting an upside potential of over 10% from its current price levels. As the financial landscape continues to shift, keeping an eye on tariff developments-and their implications for major players like Amazon-could be crucial for stock traders navigating the dynamic e-commerce sector.