Amazon (AMZN) reports first-quarter earnings late Thursday, with the company uniquely positioned to perform well despite the coronavirus upheaval. Amazon stock is currently extended from a recent buy zone.
The company’s report comes in after the market close. Wall Street expects adjusted earnings of $6.34 per share, a drop of 11% from the year-ago period. The revenue forecast calls for $72.9 billion, up 22%.
Amazon stock climbed 2.6%, near 2,434, during afternoon trading on the stock market today.
Amazon stock broke out of a cup base on April 14, shooting above a buy point of 2,186.05. The stock currently trades above the upper end of its buy range, which extends to 2,295.35. Buying a stock ahead of earnings can be risky as shares can move sharply up or down, depending on the report.
As the coronavirus pandemic grips the nation, consumers are spending time and money working from home. They’re also shopping online in order to avoid crowds outdoors. Moreover, state and local authorities want consumers to remain indoors as much as possible.
The resulting tidal wave of new demand for household and home office supplies has created bottlenecks and shortages. In order to fulfill spiking demand, Amazon said it recently completed previous plans to hire 100,000 additional workers and will add another 75,000 workers on top of that.
Analyst Views On Amazon Stock
“Given how irreplaceable Amazon has proven to many during this crisis, we believe the company has an opportunity to expand wallet share with existing customers and shape the online habits of new users,” Monness Crespi Hardt analyst Brian White said in a note to clients earlier this week.
“We believe Amazon and its dedicated employees will be elevated to hero status in the minds of many customers when this crisis is over, further strengthening Amazon’s brand.”
White has a buy rating and price target of 2,650 on Amazon stock.
RBC Capital Markets analyst Mark Mahaney has an outperform rating on Amazon and price target of 2,600.
“Industry datapoints clearly suggest that e-commerce has seen a surge in demand during the Covid-19 crisis,” Mahaney wrote in his report to clients this week. “We also believe Amazon Web Services has experienced a surge in usage,” he said, referring to the company’s cloud computing unit.
Jefferies analyst Brent Thill has a buy rating on Amazon stock and price target of 2,800.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
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