Amazon's Q1 2024 Results Exceed Expectations with Strong Retail and Cloud Performances

Loop Capital's Rob Sanderson raised their price target on Amazon (NASDAQ: AMZN) by 4.7% from $215 to $225 on 2024/05/06. The analyst maintained their Strong Buy rating on the stock. Sanderson highlighted the strong performances of Amazon's retail and public cloud businesses after reviewing the company's Q1 2024 print, released on 2024/04/30. The retail division contributed over 50% of the profit upside, driven by steady service growth and cost-to-serve normalization. Sanderson predicted that Amazon's earnings upside would last "for quite some time" until the consensus acknowledges its recovery.

Amazon's Q1 2024 results exceeded expectations, with an EPS of $1.13, beating the Zacks Consensus Estimate of $0.83 by 36.1%. This also represented a significant increase of 264.5% compared to Q1 2023's EPS of $0.31. The company reported revenue of $143.31 billion, surpassing the Zacks Consensus Estimate by 0.55% and showing a 13% increase compared to Q1 2023's revenue of $127.36 billion. Furthermore, Amazon's operating income for Q1 2024 stood at $15.3 billion, reflecting a substantial YoY growth of 218.8%.

Looking ahead to Q2 2024, Amazon's management provided guidance of revenue ranging from $144 billion to $149 billion. If achieved, this would represent a 7% to 11% increase year-over-year. The company also projected an operating income of $10 billion to $14 billion for the same period.

President and CEO Andy Jassy expressed satisfaction with the company's performance in Q1 2024, citing improvements in customer experience and strong financial results. Jassy highlighted the reacceleration of AWS's growth rate and the continued expansion of Amazon's Stores business. He also emphasized the benefits of advertising efforts, which have been boosted by the growth of the Stores and Prime Video businesses.

Regarding analyst ratings, 100% of top-rated analysts currently rate AMZN as a Strong Buy or Buy. No analysts consider it a Hold, and there are no recommendations to sell the stock. The consensus forecast among analysts suggests that AMZN will deliver earnings per share (EPS) of $4.67 for the upcoming year. If these predictions hold true, AMZN's next yearly EPS will experience a significant 28.4% increase on a year-over-year basis.

Since the release of Amazon's Q1 2024 report on 2024/04/30, the stock price has risen by 7.8%. In comparison, the stock has seen an impressive year-over-year increase of 78.3%. During this period, AMZN has outperformed the S&P 500, which has experienced a 25.2% increase.

Rob Sanderson, the Loop Capital analyst who raised Amazon's price target, is ranked in the top 17% of Wall Street analysts by WallStreetZen. With an average return of 9.2% and a 55.8% win rate, Sanderson specializes in the Industrials and Consumer Cyclical sectors, among others.

Amazon.com, Inc. is a global retail and technology company that operates through three segments: North America, International, and Amazon Web Services (AWS). The company offers a wide range of consumer products and subscriptions through online and physical stores. Additionally, Amazon manufactures and sells electronic devices and develops media content. The company also provides various services, including fulfillment, advertising, and digital content subscriptions. With its headquarters in Seattle, Washington, Amazon serves consumers, sellers, developers, enterprises, content creators, and advertisers worldwide.

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