Amazon Valued at 29x P/E with AWS Growth of 24% and $200B Capex Plan
Amazon trades at a 29x P/E ratio with AWS revenue up 24% year-over-year, a custom chip business growing over 100%, and a $200 billion capital expenditure plan for 2026. The stock also trades below retail peers despite stronger growth metrics at AWS and cloud computing.
1. AI Stock Comparison Highlights Valuation
A recent analysis contrasts Amazon’s 29x P/E ratio with Palantir’s 240x, noting Amazon’s more sustainable valuation against Palantir’s high multiple despite its 70% revenue growth. This positions Amazon as a comparatively attractive AI play for value-oriented investors.
2. AWS and Custom Chips Drive Growth
AWS posted a 24% year-over-year revenue increase, with the custom chip segment expanding at triple-digit rates. These trends underpin Amazon’s cloud leadership and diversification into high-margin hardware solutions.
3. $200B Capex Commitment for 2026
Amazon plans $200 billion in capital expenditures next year, focused on data centers, logistics, and chip development. This aggressive investment schedule aims to fuel long-term growth but may pressure near-term free cash flow.