Should you buy AMZN? (May, 2024)

Following the company’s first quarter results, Roth MKM analyst Rohit Kulkarni has maintained his “Buy” rating on Amazon (Amazon Stock Quote, Chart, News, Analysts, Financials NASDAQ:AMZN).

On April 30, AMZN reported its Q1, 2024 results. The company posted Net Income of $10.4-billion on Net Sales of $143.3-billion, a topline that was up 13% over the same period a year prior.

“It was a good start to the year across the business, and you can see that in both our customer experience improvements and financial results,” said CEO Andy Jassy. “The combination of companies renewing their infrastructure modernization efforts and the appeal of AWS’s AI capabilities is reaccelerating AWS’s growth rate (now at a $100 billion annual revenue run rate); our Stores business continues to expand selection, provide everyday low prices, and accelerate delivery speed (setting another record on speed for Prime customers in Q1) while lowering our cost to serve; and, our Advertising efforts continue to benefit from the growth of our Stores and Prime Video businesses. It’s very early days in all of our businesses and we remain excited by how much more we can make customers’ lives better and easier moving forward.”

Kulkarni summarized the quarterly results.

“AMZN reported an impressive 1Q beat with revenue coming close to high-end guide and op income materially above high-end guide. 2Q revenue guide is a bit soft and 2Q op income brackets expectations, and feels conservative.
AWS is now a $100bn ARR software company, and both N. America and International Retail margins turned positive for the first time since peak pandemic days,” he wrote.

In a research update to clients May 1, Kulkarni maintained his “Buy” rating and raised his price target on Amazon from $205.00 to $210.00.

The analyst thinks AMZN will post EPS of $4.48 per share on revenue of $630.1-billion in fiscal 2024. He expects those numbers will improve to EPS of $5.49 per share on a topline of $687.7-billion in fiscal 2025.