Amazon.com Inc. is expected to report another solid financial period when it reports third-quarter earnings after the market closes Tuesday, fueled by stronger e-commerce sales and increased appetite for its cloud-computing service, Amazon Web Services.
Total Amazon revenue is expected to rise by 29% year-over-year, with US e-commerce sales increasing by 16% and AWS revenues rising by 52%, according to Cantor Fitzgerald, which recently raised its price target on Amazon shares to $1,000, Market Watch reports.
“Our checks show healthy double-digit pace of growth in e-commerce and we view Amazon as one of the prime beneficiaries of such a trend,” Cantor Fitzgerald analyst Youssef Squali said in a note to clients Monday.
Sell-side analysts surveyed by FactSet expect Amazon to report a profit of 78 cents a share, compared with 17 cents in the year-earlier period. Contributors to Estimize, a software platform that uses crowdsourcing from hedge-fund executives, brokerages and buy-side analysts to predict earnings, expect Amazon to report a dollar a share. The company topped both consensus estimates by a wide margin in the first two quarters of this fiscal year after missing Wall Street’s guidance by roughly 46% in the final quarter of fiscal 2015.
After years of uneven profits, Amazon has begun to deliver substantial earnings,” said Wedbush analyst Michael Pachter, who has an outperform rating and $900 price target on the stock.
The company is expected to report revenue of $32.6 billion, compared with $23.2 billion in the year-earlier period, according to the FactSet consensus estimate. Estimize has Amazon’s revenue coming in slightly lower, around $32.250 billion. Amazon beat both guidance ranges in its past two fiscal quarters.
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