Ignite your portfolio—get the names of the top companies driving the AI revolution in this exclusive Forbes report, 12 Top AI Stocks to Buy Now. The company is scheduled to release its next quarterly earnings announcement on Thursday, February 1st 2024. Champion sees beatable Wall Street targets for Pinterest moving to 2024. Plus, he’s upbeat about the company’s ability to drive incremental margin improvements, with estimates there also appearing conservative.
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These moves are intended to drive revenue, operating income, and free cash flows in the long term and enhance AMZN’s return on invested capital. “In my general conversations with public market investors and sell-side analysts, few have a correct view of the advertising market,” Wieser said. “Many think that growth can continue at double-digit levels for the fastest-growing companies for much longer a period of time than is realistic to expect.”
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According to 43 analysts, the average rating for AMZN stock is “Strong Buy.” The 12-month stock price forecast is $172.77, which is an increase of 10.26% from the latest price. Management said on the earnings call that macroeconomic challenges were easing, but it still sees shoppers focusing on value. With the macro climate improving, the ad business remaining strong, and profitability expanding, the e-commerce division also looks set to drive the stock higher over the coming months. In the second quarter, AWS generated $5.4 billion in operating income or more than two-thirds of the total. However, AWS’ growth has slowed significantly over the last two years, which is one reason the stock is still down substantially from its pandemic-era peak. The company also provided an operating income guidance of $5.5 billion to $8.5 billion, which potentially triples the $2.5 billion earned in last year’s third quarter.
Susquehanna downgraded KLA Corp. (KLAC) to neutral from positive. The other catalyst is the return of share repurchases for AMZN. Therefore, let’s delve into AMZN’s initiatives aimed at driving profitability and strengthening its position in the AI space.
Founded in 1993, The Motley Fool is a financial services company dedicated to making the world smarter, happier, and richer. The Motley Fool reaches millions of people every month through our premium investing solutions, free guidance and market analysis on Fool.com, top-rated podcasts, and non-profit The Motley Fool Foundation. In North America, it reported an operating income of $3.2 billion, up from an operating loss of $627 million, while it narrowed its international operating loss from $1.8 billion to $895 million.
JPMorgan: ‘The stock can continue to climb higher’
Microsoft’s decline was less severe, with the stock falling less than 2%. I outline AMZN’s financial outlook in the subsequent section. One of the key themes, if not THE theme of 2023, was the dominance of the mega cap growth trade.
Shares of chipmaker AMD also dropped despite better-than-expected revenue numbers and profit that met estimates. The stock, which is up 137% in the past year on excitement about its artificial intelligence processors, fell almost 6% after the announcement. Alphabet on Tuesday reported 13% revenue growth, the fastest rate of expansion since early 2022. Sales of $86.31 billion https://bigbostrade.com/ topped the average estimate of $85.33 billion, according to LSEG, formerly known as Refinitiv. The companies generated excitement last year by riding the artificial intelligence wave, and were also lauded by shareholders for their dramatic cost-cutting efforts, which included eliminating thousands of jobs. In investor speak, the stocks were priced for perfection.
Where Does Amazon Release Its Earnings?
Microsoft’s outlook was a bit light, overshadowing the earnings and revenue beat. The company called for fiscal third-quarter sales between $60 billion and $61 billion, while analysts polled by LSEG had expected $60.93 billion. Both companies also beat expectations in their cloud businesses, with Google Cloud reporting 25% growth and Microsoft’s larger Azure and other cloud services expanding 30%. That’s Wall Street’s reaction to quarterly results on Tuesday from Alphabet and Microsoft. Both companies reported revenue and earnings that exceeded estimates, yet the stocks sold off after hours, a drop that carried over into Wednesday’s trading session.
Should I Buy Amazon.com Stock? AMZN Pros and Cons Explained
Tech giants lose $270 billion in market value as ‘Magnificent Seven’ stocks suffer from disappointing earnings reports and investor concerns over interest rate changes. Analysts at Bloomberg Intelligence said building sales momentum should help the e-commerce giant to Wall Street estimates when it reports earnings results. Brian Wieser, an analyst at media and advertising consultancy Madison and Wall, said the market has unrealistic expectations for Google given its size and dominance. Revenue at Microsoft increased 18% to $62.02 billion, topping the $61.12 billion average analyst estimate. In the weeks heading into their earnings reports, investors were buying as if they expected positive surprises.
As such, I have a reasonably positive view of AMZN’s growth prospects for the long run. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. The company is not a true retailer nor a pure-play manufacturer but in the business of connecting consumers and merchants together. The website was first created as a means of selling books at a discount but it has since grown to include most verticals in the retail sector.
“We model 13% growth in AWS in 4Q and believe the Street expectation is in the 12.5% to 13.0% range, based on our conversations,” JPMorgan said.
Prior to earnings, Alphabet was up 56% for the year and climbed to a fresh high last week, exceeding the prior record from late 2021, the peak of the tech boom. Microsoft was up 70% over the past 12 months, also reaching a fresh high recently and surpassing Apple as the most valuable publicly traded company. The second-quarter result shows those efforts are already starting to bear fruit, and profit margins should expand as the economy improves and management scrutinizes its costs further. The one disappointment from Alphabet was in Google’s ad business, which delivered revenue of $65.52 billion, trailing analysts’ estimates of $65.94 billion, according to StreetAccount. One key thing to note that e-commerce penetration isn’t that high.
Access our top stock picks, proprietary research reports, stock screeners and more. “Lapping cost optimization and AI-driven demand are key drivers for AWS; we think it [is] important for management to call out potential for first-quarter acceleration on the call,” Bank of America said. Jassy also announced plans to lay off roughly 27,000 corporate employees early in the year, and the company’s headcount fell for the third quarter in a row, down 4% to 1.46 billion. This is likely a factor of attrition at its warehouses as well as layoffs among corporate staff.
Its advertising business, which is included in those segments, also delivered strong growth, with revenue up 22% year over year to $10.7 billion. He is the author of the investing group Asia Value & Moat Stocks, providing ideas for value investors seeking investment opportunities listed in Asia, with a particular focus on the Hong Kong market. He hunts for deep value balance sheet bargains professional trading strategies and wide moat stocks and provides a range of watch lists with monthly updates within his investing group. The market’s negative reaction to AMZN’s Q financial results is likely attributable to the company’s below-expectations fourth quarter top line and operating profit guidance. Along with shuttering businesses and scaling down experiments, the company eliminated 27,000 corporate roles.