Amazon's Mixed Q1 Results: Capex Guidance Impacts Stock Price

Key Insights:

* Amazon (AMZN) shares declined 3% in pre-market trading after the company reported mixed Q1 guidance and significant capex spending plans.
* Foreign exchange fluctuations led to a $2.1 billion revenue miss from analyst expectations.
* Amazon announced a $104 billion capex guide for 2023, exceeding market forecasts.

Analyst Outlook:

Despite the initial stock decline, analysts remain bullish on Amazon for several reasons:

* Anticipated sales reacceleration in AWS later this year.
* Strong performance in AWS with consistent sales growth and high operating profit margins.
* Accelerated sales growth at physical stores.
* Amazon's highest quarterly operating income ever.

Top Wall Street Insights:

* Pivotal Research:
* Rating: Buy
* Price Target: $260
* Emphasizes AWS growth potential, margin expansion opportunities, and attractive valuation.
* DA Davidson:
* Rating: Buy
* Price Target: $280
* Highlights the health of AWS adoption and potential for increased growth.
* JP Morgan:
* Rating: Overweight
* Price Target: $270
* Views GenAI as a major growth opportunity for AWS and believes the capex spending will support its long-term growth trajectory.
* Wedbush:
* Rating: Outperform
* Price Target: $280
* Expects AI contributions to AWS growth, cost optimization, and monetization of new technologies to drive future performance.

Conclusion:

Amazon's Q1 results and capex announcement have influenced its short-term stock price. However, analysts maintain a positive outlook based on the strength of AWS, improvement initiatives, and potential for future growth drivers.