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Investing.com - Loop Capital reiterated a Buy rating and $360.00 price target on Amazon.com (NASDAQ:AMZN). The stock currently trades at $249.02, near its 52-week high of $258.60, with shares surging 12.6% over the past week.
The firm noted Amazon confirmed the Globalstar acquisition this morning. Loop Capital believes the satellite broadband investment has been an indirect overhang on retail segment margin, and the upcoming change to capitalizing most expenses will remove this pressure.
The firm said the upcoming SpaceX IPO will shine a more favorable light on Amazon’s satellite broadband ambitions. The OpenAI CRO had encouraging commentary about inbound demand for ChatGPT on Amazon Bedrock.
Last week’s CEO letter included several new point disclosures, including on revenue contribution from AI chips and AI services. Loop Capital said this reinforces its view that AWS revenue will likely continue to accelerate as capacity becomes serviceable.
AWS is the most important driver of Amazon shares and represents over 60% of Loop Capital’s sum-of-the-parts valuation. According to InvestingPro analysis, the stock is fairly valued at current levels, with the company maintaining a market cap of $2.68 trillion. The firm reiterated its Buy rating ahead of results on April 23. For deeper insights, Amazon is among 1,400+ US equities covered in comprehensive Pro Research Reports.
In other recent news, Amazon has announced its acquisition of Globalstar for $11.7 billion. This move is expected to expand Amazon’s satellite services, integrating Globalstar’s direct-to-device service into its low Earth orbit network. The acquisition agreement allows Globalstar stockholders to receive either cash or Amazon stock, with specific conditions on cash elections. Analysts from Citizens have reiterated a Market Outperform rating for Amazon, while Truist Securities maintains a Buy rating, highlighting the strategic advantage against competitors like Starlink.
Additionally, Amazon introduced a new platform called Bio Discovery through its cloud division. This platform offers researchers access to over 40 AI biology models, aimed at accelerating drug discovery. The tool enables scientists to use computational design and wet-lab validation without needing direct computational expertise. Jefferies has commented on the launch, noting its potential to significantly aid in drug development. These developments underscore Amazon’s ongoing efforts to diversify and enhance its technological capabilities.
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