AMZN Stock Rises Premarket: Wall Street Sees Bigger AI Returns Ahead As Amazon Cloud Momentum Builds

Analysts see up to 23% upside for Amazon stock.

• Roth Capital and Morgan Stanley raised their Amazon price targets, citing strong AI investment returns and improving AWS profit.  
• The company’s cloud business expanded 37% year over year, while quarterly revenue rose 20% to $200.6 billion.
• Morningstar’s Dan Romanoff highlighted strong demand for Amazon’s cloud and AI services, along with continued consumer resilience. 

Amazon.com Inc. (AMZN) stock gained premarket on Monday as the company’s AI-driven cloud momentum, expanding margins and better-than-expected earnings prompted analysts to raise price targets, with several firms highlighting Amazon’s improving returns from artificial intelligence investments and long-term growth prospects. 

Analyst Upgrades Reflect Amazon’s AI Optimism

Roth Capital increased its price target to $325 from $300 while maintaining a ‘Buy’ rating, citing Amazon’s “highest AI return on invested capital vs. peers”. The firm also highlighted better AWS profit and said Amazon’s AI cloud services could generate strong profit margins.

Morgan Stanley raised its Amazon price target to $335 from $330 and kept an ‘Overweight’ rating on the stock, implying a 23% upside to the stock’s last close. The firm highlighted stronger momentum at Amazon Web Services (AWS), including faster expansion, improved profit and a healthier backlog. 

The firm also noted encouraging developments across grocery operations, robotics initiatives and emerging AI-powered agents. Amazon stock gained over 1% in Monday’s premarket. 

Amazon AWS Becomes Key Growth Engine

RBC Capital analyst Brad Erickson boosted Amazon’s price target to $330 from $320 while maintaining an ‘Outperform’ rating. Erickson said the company’s Q2 results matched expectations, with AWS growth gaining and profit trends suggesting AI investments may not weigh on returns as heavily as some investors feared.

Amazon’s AWS revenue surged 37% year-on-year, marking its fastest expansion in several quarters despite operating at a massive scale. Revenue of $200.6 billion for the quarter represented a 20% increase. 

Morningstar analyst Dan Romanoff said demand increased across conventional cloud services and artificial intelligence workloads, supporting Amazon’s decision to continue investing heavily in data centers and infrastructure. Romanoff pointed to steady consumer spending, strong Prime Day performance, expanding grocery offerings and faster delivery options as factors supporting demand.

AMZN Stock: Retail View 

On Stocktwits, retail sentiment around the stock remained in ‘extremely bullish’ territory. 

A user said, “$AMZN is about to take out previous 52-week high! We need to be over $300!!”

Another user said, “The AI race requires massive infrastructure spending. 

$AMZN  is one of the companies building the backbone for this next wave, but the bigger opportunity may be in the suppliers enabling the expansion behind the scenes.” 

AMZN stock has gained 17% year-to-date. 

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