On October 9, 2023, Wells Fargo & Co released a financial outlook for Amazon's Q3 2023. On October 27, Amazon will release its third quarter financial report.
I. Valuation
Stock Rating:Overweight.
Closing price: $128.26 (October 9, 2023)
Target price: $165.00
2.Business outlook
Amazon provides services to consumers, sellers, and developers, allowing sellers to sell products on its website and their own branded websites. Amazon provides services to developers through Amazon Web Services (AWS), which provides the technical infrastructure for developers to support any type of business. Amazon organizes its business into three main divisions: North America, International, and AWS.
Wells Fargo & Co expects its third quarter revenue and profits to be in line with market expectations. Due to the sluggishness of the cloud market, it slightly lowered its revenue expectations for AWS in the third and fourth quarters.
3. Key factor analysis
It is expected that the total revenue and profits in the third quarter will be basically in line with market expectations:Wells Fargo & Co predicts total revenue and profits to be $141.8 billion/$8 billion, while market forecasts are $141.6 billion/$7.7 billion. The growth of AWS may be the key variable in this financial report. Based on the end-of-quarter survey of the cloud market, Wells Fargo has lowered its third quarter AWS revenue forecast by 100 basis points, expecting a year-on-year growth of 13% (indicating that AWS is not yet...)