Equities

Amazon's Bright Future: Jefferies Raises Price Target to $225, Bullish on AWS and Advertising Growth

POSITIVE

Analysts forecast growth for Amazon, Meta, and Coinbase, while cautioning a potential 'rate trap' for Bank of America.

By Bill Bullington

4/4, 07:39 EDT
Amazon.com, Inc.
Bank of America Corporation
Coinbase Global, Inc.
DoorDash, Inc.
Meta Platforms, Inc.
Tesla, Inc.
article-main-img

Key Takeaway

  • Jefferies raises Amazon's price target to $225, bullish on AWS and advertising growth; shares up over 20% in 2024.
  • Benchmark initiates DoorDash with a buy rating, $165 target, citing market dominance; Meta's ad revenue growth leads to a new $585 price target by Jefferies.
  • UBS downgrades Bank of America to neutral despite an 11% share increase in 2024, highlighting a potential 'rate trap'.

Amazon's Bright Horizon

Jefferies has recently shone a spotlight on Amazon, projecting a bright future for the e-commerce giant. With a raised price target to $225 per share, Jefferies' optimism is rooted in Amazon's diverse growth avenues, particularly in its AWS (Amazon Web Services) and advertising sectors. Analyst Brent Thill emphasized the company's potential for revenue growth and margin accretion, highlighting the strategic investments in AWS, content, and fulfillment as key drivers for expansion. Despite the need for Amazon to bolster its AI offerings to remain competitive, the overall sentiment remains highly positive, with shares already up more than 20% in 2024.

DoorDash's Dominant Stride

Benchmark's initiation of DoorDash with a buy rating and a $165 price target underscores the delivery service's commanding presence in the market. Analyst Mark Zgutowicz praised DoorDash's "ever-growing dominance" and its successful expansion into new sectors like grocery and retail. With a nearly 19% upside forecasted, DoorDash's strategic positioning and network effects are expected to fuel its continued success.

Wayfair's Promising Turnaround

Evercore ISI's upgrade of Wayfair to outperform, coupled with a price target increase to $80, signals a turning point for the home furnishing company. Analyst Oliver Wintermantel pointed to improving fundamentals and a potential market recovery as reasons for optimism. The anticipated margin improvements and a "meaningful re-rating" in the coming months suggest a bright future for Wayfair, with shares poised for significant growth.

Tesla's Resilient Path Forward

Despite a slight adjustment in Tesla's price target to $310, Morgan Stanley's Adam Jonas remains bullish on the electric vehicle maker. Jonas believes that Tesla's first-quarter delivery challenges will stabilize by the second quarter, emphasizing the company's broader opportunities beyond the immediate EV market concerns. Tesla's innovative plays, particularly in recurring revenue opportunities, underscore its resilience and potential for substantial growth.

Coinbase's Crypto Leadership

Oppenheimer's increased price target for Coinbase to $276 reflects confidence in the cryptocurrency exchange's long-term prospects. Analyst Owen Lau highlighted Coinbase's role as an enabler of crypto innovation and its positioning to benefit from widespread digital asset adoption. With shares already up more than 44% in 2024, Coinbase's leadership in the cryptoeconomy is clear.

Meta Platforms' Advertising Triumph

Jefferies' adjustment of Meta Platforms' price target to $585 signals strong confidence in the social media giant's advertising revenue growth. Analyst Brent Thill noted Meta's potential to outgrow Amazon's ad business for the first time since 2015, driven by its suite of generative AI products. With a projected capture of 50% of incremental industry ad dollars, Meta's strategic focus on AI and advertising is set to propel its market share and stock performance.

Bank of America's Steady Course

Despite UBS's downgrade of Bank of America to neutral, the firm acknowledges the bank's positive momentum. Analyst Erika Najarian cited strong deposit growth, a revitalized investment banking sector, and the potential for increased buybacks as factors supporting the bank's outlook. With shares up more than 11% in 2024, Bank of America's strategic strengths are evident, even amidst challenges.