TLDR
- Amazon (AMZN) stock traded at $257.82, down 2%, a week before its Oct. 29 earnings report.
- Analysts expect EPS of $1.96 and revenue of $202.21 billion.
- AWS growth, the $220 billion capex plan and operating income guidance are the main focus.
- MACD is positive, with resistance at $259.50 and support at $244.50.
- Morningstarās fair value estimate is $300, and the average Wall Street target is $335.62.
Amazon (AMZN) stock traded at $257.82 in recent trading, down 2%. It is still up about 8% for the year.
Amazon reports third-quarter results after the close on Oct. 29. Analysts expect earnings per share of $1.96 on revenue of $202.21 billion.
Last quarter set a high bar. Earnings per share came in at $5.75, against an estimate of $1.82.
That result included a $53.4 billion gain tied to Amazonās Anthropic stake. Revenue also beat, at $200.61 billion versus $196.46 billion expected, which is a tough act to follow.
What Wall Street Is Watching
AWS is the main event. Revenue grew 37% to $42.2 billion last quarter, its fastest pace in 18 quarters.
Analysts expect growth of 30% to 35% this time. Morningstar says the real bar sits near the high 30s.
Margin matters too. AWS posted a 39.4% margin last quarter, while depreciation rose 67%.
The AWS backlog stands at $496 billion. That gives the segment a deep order book going in.
Capital spending is the next question. Amazon raised its 2026 capex outlook to $220 billion from $200 billion in July.
Morningstar says the raise reflected higher memory prices, not added capacity. Trailing free cash flow is slightly negative.
Third-quarter guidance calls for sales of $197 billion to $202 billion. Operating income is guided to $22.5 billion to $26.5 billion.
Prime Day moved into the second quarter this year. Amazon said that cost nearly 4 points of sales growth.
Operating income has beaten the top of the guided range in each of the last eight quarters, per Morningstar. Advertising rose 26% to $19.8 billion last quarter.
Chart Setup and Analyst Targets
Amazon trades about 1.1% above its 20-day average of $254.46 and 5.8% above its 200-day at $243.21. The 20-day still sits below the 50-day at $256.33, which can keep rallies choppy.
MACD is above its signal line with a positive histogram, which points to easing downside pressure. Resistance sits at $259.50, with support at $244.50.
What to watch: a break below $244.50 could put the 200-day line in play, while a move above $259.50 would show buyers gaining ground.
Morningstar rates the stock four stars with a $300 fair value estimate. At about $262, it put the stock 16% to 17% below that level.
The average Wall Street target is $335.62, with a Buy rating. Morgan Stanley raised its target to $350 on Oct. 19, while Wells Fargo cut to $329 and Cantor Fitzgerald to $310 on Oct. 12.
Benzinga Pro data show Amazon trading 1.73% lower at $257.82. The stock is up 20% over the past 12 months.
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