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Amazon's Stock Shows Positive Momentum and Analysts Predict Upside Potential

StockInvest.us, 1 month ago

Amazon Company Overview

Amazon.com, Inc. (NASDAQ: AMZN) is an multinational technology company, renowned for its disruption of well-established industries through technological innovation and mass scale.

Stock Performance

As of the close of the market on November 01, 2023, Amazon's stock was priced at $137, having increased by 2.94% or $3.91 for that trading day. Thus far for the year, the stock has experienced a low point of $81.43 and a high point of $145.86. Volume for that day reached over 59 million, slightly above its average daily volume of approximately 54.90 million shares.

Amazon has a substantial market capitalization of $1.42 trillion, reaffirming its status as one of the world's most valuable companies.

Technical Analysis

In the technical perspective, Amazon's stock has shown a positive momentum. The Relative Strength Index (RSI14), a momentum oscillator that measures the speed and change of price movements, is at 55, indicating a somewhat higher buying pressure.

Moreover, the stock has consistently traded above its 50-day ($132.14) and 200-day ($117.64) moving averages — a positive trend. However, it's essential to consider that the Moving Average Convergence Divergence (MACD) is slightly negative over a 3-month period, indicating some bearish undertones in the short term.

The Average True Range (ATR), a measure of market volatility, stands at 3.09, suggesting the stock's price has experienced some fluctuations.

Regarding support and resistance levels, there is a strong support point at $127.74 and an immediate resistance at $137.85.

Fundamental Analysis

Amazon Amazon has a slightly high Price to Earnings (PE) ratio of 71.35 compared to the industry average, which indicates a high degree of investor expectations for the company's future earnings growth. This future growth is reflected in an earnings per share (EPS) value of 1.92.

In terms of shares outstanding, Amazon has approximately 10.34 billion. The company's recent discounted cash flow (DCF) valuation arrived at a price of $142.29, which is higher than the current price per share. This suggests the stock may be undervalued.

The analyst consensus is fundamentally positive with a high number of analysts giving a 'buy' recommendation, making the overall consensus a 'Buy'. The stock has a target median of $170 and a consensus target of $166.19, signaling a strong upside potential.

Company News

Amazon has entered into a new $15 billion credit facility, a significant increase from the previous value of $10 billion. This expansion of credits could be put towards new investments or potential acquisitions which could positively affect the stock price.

The company is also in the news for legal proceedings with Nokia, which, depending on the outcome, could influence the stock performance.

Furthermore, Amazon has received positive analyst coverage suggesting potential growth, indicating that it might be well-posed for a surge.

Predictions for Future Performance

Given the positive trend in the stock, the analyst consensus for upside potential, and the anticipation of solid earnings estimate revisions, Amazon's stock price might continue climbing in the near term.

Stock Evaluation

Considering Amazon's robust financial health, the strength of its business model, and positive technical and fundamental factors, the evaluation for their stock is a Buy. This recommendation is backed by the stock's strong positivity and potential performance indicators, alongside its vast upside potential according to multiple analyses and the overall 'Buy' consensus among analysts.

Check full Amazon forecast and analysis here.