Amazon shares tested an all-time high Tuesday, adding to a recent breakout to trade above 200. Earlier in the day, an Amazon stock analyst said the tech giant's cloud business is near an AI "inflection point."
The market cap for Amazon cleared $2 trillion for the first time last week, helped by a breakout from a flat base buy point of 191.70. An intraday high of 200.43 on Tuesday marked the first time AMZN shares have moved above 200, following a 20-for-1 stock split in June 2022.
Shares have eased back slightly and were sitting at 200.06 at last check, representing a 1.4% gain for Amazon on the stock market today.
Analyst Sees AI Inflection Point
The push higher for Amazon stock followed a positive analyst report. Mizuho analyst James Lee wrote to clients Tuesday that the firm maintains Amazon stock as its top pick, following a quarterly survey of Amazon Web Services customers.
Lee expects that AWS' generative AI offering will help power 2024 annual sales growth above the 18% that analysts are projecting, on average, according to FactSet.
"Gen-AI projects are nearing an inflection point, with external-facing models six months away from commercial deployments," Lee wrote to clients. "With that in mind, we have increased conviction of AWS acceleration and our above-the-Street revenue growth forecast of 20%."
Lee reiterated a price target of 240 for Amazon stock.
Amazon Chief Executive Andy Jassy, who will complete his third full year on the job on Friday, has made generative AI a central focus for Amazon's future plans. The AWS cloud business is hoping to benefit by renting out access to the vast computing power required to train and operate AI algorithms. AWS is a key profit driver for Amazon and competes with Microsoft and Google parent company Alphabet.
To help power its AI ambitions, Amazon plans to spend more than $100 billion over the next decade on data centers, the Wall Street Journal reported Monday.
Amazon Stock: Ahead More Than 30% This Year
After a rough 2022, Amazon stock rallied more than 80% last year. But prior to the breakout last week, shares had yet to decisively climb beyond July 2021 highs near 188.
But Amazon stock has gained 31.5% this year and is now firmly in record territory. Shares have easily outpaced a roughly 15% gain for the S&P 500.
