Bank of America Lifts Amazon Target to $298 on 28% AWS Growth
Bank of America lifted Amazon’s price target to $298 as AWS revenue is projected to grow 28% annually on accelerating AI workloads. Amazon will shut its Homestead, Florida warehouse July 2 for two-year renovations affecting 616 employees and may incur a $2.6 million fine under county job commitments.
1. Price Target Boost on AWS Strength
Bank of America raised its price target on Amazon shares to $298, citing AWS revenue growth projections of 28% per year driven by accelerating AI workloads. The firm highlighted demand from AI-focused customers like Anthropic, which could contribute over $1 billion in quarterly sales, as a key catalyst.
2. Q1 Earnings and Margin Outlook
Analysts expect Amazon to report Q1 revenue of about $178.4 billion and operating income near $21.4 billion, slightly above consensus. AWS growth above market forecasts is offset by margin pressures from expanding AI infrastructure services, logistics investments and fulfillment pricing adjustments, with cost cuts from prior workforce reductions providing partial relief.
3. Homestead Warehouse Renovation Impact
Amazon filed a WARN notice to close its Homestead, Florida TMB8 facility on July 2 for a two-year renovation into a new distribution center, affecting 616 employees. The company is offering transfers, relocation bonuses and rehiring options, but may face a $2.6 million penalty under a county agreement requiring 325 local jobs.