Amazon’s Potential Upside in 2024

Analyst, Thomas Champion from Piper Sandler, has designated Inc. as his top large-cap pick for 2024. He believes that the e-commerce giant has the potential to enhance its retail margins and build strong momentum in the cloud.

According to Champion, there has been a significant improvement in retail margins, and he considers Street operating income estimates for 2024 to be conservative. Additionally, he predicts that spending on Amazon Web Services (AWS), the company’s cloud-computing service, will accelerate in the coming year. This belief is supported by a recent Piper Sandler survey of chief investment officers, which revealed that AWS was the only cloud provider to experience an increase in net spending intentions compared to the first half of 2023.

Champion’s price target for Amazon’s stock has been raised to $185 from $170, suggesting a potential upside of around 25% from current levels. In comparison, his price target for Meta’s stock implies a 7% upside, while his target for Alphabet Inc. shares indicates a 14% upside.

Smaller Internet Companies: Pinterest Inc.

Champion’s top pick among smaller internet companies is Pinterest Inc. The company has performed well in 2023, with its shares increasing by 25% since the end of October. In addition, exiting the third quarter, Pinterest was likely experiencing revenue growth at a mid-teens rate year-over-year.

Champion believes that Wall Street targets for Pinterest in 2024 can be surpassed. He is optimistic about the company’s potential to drive incremental margin improvements, and he perceives current estimates to be too conservative.

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