Financial Trading Blog
Stock of the day 27/07/2016 – Amazon.com Inc
Having ended 2015 a smidge below its then-peak of $694 Amazon immediately got into trouble as the New Year began, plunging all the way to a near 6 month low of $474.30 by mid-February. Yet from that half a year nadir Amazon has risen like a phoenix from the flames, a near uninterrupted climb resulting in the company hitting a new all-time high of $759.63 on July 12th. The stock sits at a current trading price of $738.30 (IT-Finance.com, 27/07/2016).
(Source: IT-Finance.com 27/07/2016)
Back in January Amazon’s fourth quarter report helped contribute to its early in the year slide. Despite a 22% rise in revenue to $35.75 billion that was lower than the $35.93 billion forecast; more worrying was the earnings per share miss, Amazon producing $1 against the $1.56 consensus among analysts.
Yet just as that Q14 update was (at least in part) responsible for Amazon’s 6 month low back in February, the company’s first quarter report in April helped see the acceleration of its all-time high hitting growth. With earnings per share of $1.07 (against a loss of 12 cents the year before) and revenue of $29.13 billion Amazon smashed analysts’ expectations, which were for 58 cents and $27.98 billion respectively. Beyond these headline figures the main star, once again, was the company’s Web Services cloud division, which saw a heady 64% rise in revenue to $2.57 billion.
In terms of Thursday’s Q2 figures (released after the market closes), analysts are expecting Amazon to post a near 21% jump in earnings per share to $1.11 alongside a 27% increase in revenue to $29.56 billion. Investors will also be keen to hear about the progress of its Pantry and Fresh services, Amazon Prime subscription figures and the expansion of the company’s blockbuster Web Services division.
Amazon.com Inc has a consensus rating of ‘Buy’ with an average target price of $816.95.
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