Bernstein raises Amazon target price to $235 from $230.

Bernstein raises Amazon target price to $235 from $230.

In a significant move, Bernstein has increased its target price for Amazon.com Inc. (AMZN) to $235 from the previous $230. This upward revision comes amidst growing optimism about Amazon's subscription service, Prime, and its potential for future growth. The analyst firm cited Prime's high value and the company's ability to maintain subscriber numbers despite price hikes as key drivers behind the bullish outlook.

Bernstein's report underscores the value proposition of Amazon Prime, estimating that the service delivers over $1,430 in annual value to subscribers, which is more than 10 times the cost of the subscription [1]. This high value is attributed to Prime's comprehensive offerings, including fast shipping, streaming services, and additional perks like music and photo storage.

The analyst firm also noted that Amazon's Prime service is poised to see further growth, with a potential price hike in 2026 expected to add $3 billion in sales without significant churn [1]. This growth is particularly notable given the increasing competition from other subscription services like Walmart+ and Apple One.

Additionally, Bernstein highlighted Amazon's robust international expansion plans. With Prime members nearing 350 million globally by 2025, and international penetration still relatively low, there is substantial room for subscriber growth [1]. This international expansion, coupled with Prime's high value, positions Amazon to maintain its dominance in the subscription market.

Despite these positive indicators, Bernstein acknowledges potential headwinds. The firm noted that Amazon's stock has been down 3% year-to-date, and the company faces competition from other major retailers and tech companies. However, Bernstein remains optimistic about Amazon's long-term prospects, particularly given the strong value proposition of Prime and the company's ability to innovate and adapt.

In conclusion, Bernstein's revised target price for Amazon reflects a bullish outlook on the company's subscription service and its potential for future growth. As Amazon continues to expand its Prime offerings and international reach, investors can expect to see further appreciation in the stock price.

References:
[1] https://www.benzinga.com/markets/tech/25/06/46100363/prime-time-for-amazon-jpmorgan-says-your-139-could-be-worth-1430