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Amazon’s (AMZN) market capitalization surpassed $3 trillion for the first time on Aug. 3 as shareholders continued to cheer the titan’s blowout Q2 print, featuring an AI-driven 37% year-on-year increase in cloud revenue.
The post-earnings surge has pushed AMZN’s relative strength index (RSI) into the early 70s, which signals overbought conditions that often trigger a near-term selloff.
Versus its year-to-date low, Amazon stock is up more than 40% at the time of writing.
Morgan Stanley Maintains a Bullish Stance on AMZN Stock
Despite recent outperformance, Morgan Stanley’s senior analyst Brian Nowak remains convinced that AMZN shares will rip higher from here through the remainder of 2026.
Nowak recently maintained an Overweight rating on the hyperscaler and raised his price target to $335, indicating potential upside of nearly 18% from current levels.
In his research note, the analyst cited AWS growth and backlog strength as reasons to own Amazon at current levels, adding “retail was generally in-line (in Q2), but signals on grocery, robotics, and agentic are all building.”
Note that AMZN still has authorization to repurchase billions of dollars worth of its stock, which makes it even more attractive as a long-term holding.
Where Options Data Suggests AMZN Shares Are Headed
The derivatives market agrees with Morgan Stanley on Amazon shares, with the put-to-call ratio on options contracts expiring mid-October set at 0.31x, signaling a bullish skew.
According to Barchart, the upper price on those contracts currently sits at $311, indicating potential for another 9% rally within the next three months.
Investors should also note that AMZN is currently trading at a forward price-to-earnings (P/E) ratio of about 30x, which looks compelling given the company is evidently riding the AI wave.
Crucially, Amazon has a history of closing both August and September in the green — a seasonal trend that further improves its near-term appeal.
How Wall Street Recommends Playing Amazon
It's also worth mentioning that Morgan Stanley isn’t alone in recommending buying AMZN stock into post-earnings strength.
The consensus rating on Amazon sits at “Strong Buy,” with the mean price target of roughly $314 indicating potential upside of more than 10% from here.
