AMZN Stock Set For Best Day In Three Months: Morgan Stanley Expects Amazon's AWS To Grow 47% In 2027, Denotes Stock As 'Top Pick'

Morgan Stanley sees Amazon Web Services (AWS) operating as a "rule of 90" company, paving the way for Amazon to generate earnings of about $16.50 in 2028.

• Morgan Stanley reaffirmed its ‘Overweight’ rating and named Amazon its top pick. 
• Propelled by surging Nvidia GPU shipments, Morgan Stanley analysts project AWS to operate as a "Rule of 90" firm between 2027 and 2028.
•  Morgan Stanley raised the price target on Amazon to $350 from $335.

Amazon.com Inc. (AMZN) share price rose nearly 5% on Monday and was on-track to record its best day in nearly three months after Morgan Stanley reaffirmed its ‘Overweight’ recommendation on the stock and hiked its share price target. 

Morgan Stanley analyst Brian Nowak raised the firm's price target on AMZN to $350 from $335, a 40% upside from Friday's closing price, while maintaining an Overweight rating on the shares and moving them to a ‘Top Pick’ status, as per the research report accessed by TheFly.

Nowak noted that AWS's growth and profit runway is "under-appreciated," and expects 47% and 42% year-over-year growth in 2027 and 2028, respectively, largely to factor in Nvidia’s (NVDA) indication that AWS will deploy 2 million additional NVIDIA GPUs across its global infrastructure over those two years. 

The firm sees AWS operating as a "rule of 90" company in 2027-2028, paving the way for Amazon to generate earnings of $16.50 a share in 2028. 

Meanwhile, Amazon also signed an agreement to fund a nuclear power project in Indiana. 

Amazon Funds Indiana Nuclear Project

X-energy (XE) and American Electric Power (AEP) on Monday announced a joint development agreement to evaluate the feasibility of a proposed 960-megawatt small modular reactor project in Indiana, with Amazon (AMZN) supporting the project’s development through a funding agreement. 

The proposed facility is expected to house a 12-unit Xe-100 plant situated near the former Breed Generating Station in Sullivan County, Indiana, re-purposing an existing AEP-owned brownfield site for advanced nuclear power capabilities.

Under the arrangement, Amazon is set to supply milestone-contingent capital to drive initial feasibility studies. The initiative marks the second commercial development spawned from the alliance between X-energy and Amazon, which targets deploying over 5 gigawatts of fresh nuclear capacity to the domestic power grid by 2039, alongside the Cascade Advanced Energy Facility project in Washington state with Energy Northwest.

AMZN Stock: Retail View 

Retail sentiment on Stocktwits was ‘bearish’ with ‘normal’ message volumes. 

AMZN stock has gained about 13% year-to-date.

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