Amazon closes above 2,000 after two rally days Morgan Stanley price upgrade
InvestingOnline.com
31/08/2018, 04:12Shares of Amazon closed positive on Thursday as investors welcomed Morgan Stanley target price upgrade on Wednesday. AMZN reached an all-time high of 2,025, before closing at 2,002.40.
Morgan Stanley reiterated its rating on Amazon as overweight on Wednesday and raised its price target for the AMZN share to $2,500 from Tuesday price at $1,850. It would be an increase of nearly 30% from Tuesday close price and a 25% return from current prices above 2,000.
If the hypothesis of Morgan Stanley is right, Amazon will have a valuation of $1.2 trillion, becoming the second company in stocks that are worth more than 1 trillion dollars.
“We have increasing confidence that Amazon’s rapidly growing, increasingly large, high margin revenue streams (advertising, AWS, subscriptions) will drive higher profitability and continued upward estimate revisions,” said Brian Nowak, Morgan Stanley analyst.
Nowak highlights the high-margin revenues and Amazon growth rate from segments like AWS, subscriptions, and Prime. New customers acquired from subscriptions are giving the company more opportunities for the generation of higher profits.
Amazon daily chart August 30 F
Back to the chart, Amazon closed Thursday at 2002 on Thursday after peaking in 2015. Technical conditions are favorable for room for more gains. The chart is suggesting that the upside momentum is ready to continue. MACD is bullish, and the RSI is signaling that the trend is healthy.
In the short term, the stock is overbought but rising trend looks solid. Moving averages are pointing to the north in a perfectly aligned. The stock looks bullish.
