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Investors Business Daily
Investors Business Daily
Technology
RYAN DEFFENBAUGH

Is Amazon Stock A Buy? Wall Street Sees Upside For Second-Half Of The Year

Amazon stock closed an up-and-down first half of the year trading flat. Are the e-commerce giant's shares set up for a rally in the second half of the year?

Amazon stock ended June trading at 219.39 — exactly even with where shares closed on Dec. 31 of last year. That's after Amazon rallied 7% in June and 11% in May to erase the majority of a more than 20% slide from February through April. But Amazon is underperforming the S&P 500 so far this year. The stock is still below a high of 242.52 reached in February.

Shifts in President Donald Trump's tariff plans contributed to the roller coaster ride. Amazon stock tumbled following April 2's "Liberation Day," when Trump announced his broad tariff plan. But they surged in a relief rally once Trump announced a deal on May 12 to lower the steepest tariffs on Chinese imports.

Meanwhile, analysts are scrutinizing the position of the Amazon Web Services' cloud business in the battle for enterprise artificial intelligence spending against Microsoft. Walmart, meanwhile, is chasing Amazon's big lead in U.S. e-commerce. 

Still, investors entered this year optimistic about Amazon's AI potential and e-commerce profitability gains. Despite a rocky start, Amazon stock still has a buy call from 97% of the 71 analysts following the stock, according to FactSet.

Here's what to know about recent stock action and news from Amazon stock for investors weighing whether it is a buy or sell:

Amazon Stock: Cup-With-Handle Pattern

Amazon stock was ahead a fraction in premarket trading Tuesday, near 219.61.

Shares are hovering near a 5% buy zone above a 214.84 cup-with-handle base entry, according to IBD MarketSurge.

After testing support at its 21-day line last week, Amazon stock bounced up from the short-term trendline with a nearly 3% gain on Friday.

Amazon's Relative Strength Rating sits at 75 out a best-possible 99. That means Amazon has outperformed 75% of stocks in the IBD database over the past 12 months. While that is an improvement from a 51 score three months ago, IBD recommends focusing on stocks with at least an 80 RS Rating.

The IBD Stock Checkup tool shows Amazon stock holds an IBD Composite Rating of 93 out of a best-possible 99. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.

Investors also will want to check out IBD's Big Picture column for the current market direction before considering any buy points.

Analysts See 10% Upside For Amazon Stock

The 30-year-old Amazon is one of the world's most valuable companies. It is a leader in e-commerce spending and in cloud computing through its Amazon Web Services business. It is also quickly growing its advertising business into a challenger to Google and Meta. Amazon joined the blue-chip Dow Jones Industrial Average last year.

Meanwhile, Wall Street analysts following Amazon stock have set an average target price of 241.57, according to FactSet, implying roughly 10% upside from Amazon's price as of Monday's close.

Evercore ISI analyst Mark Mahaney recently upped his price target for Amazon stock to 280 from 260 while maintaining an outperform call. In a client note on June 27, he wrote Amazon remains the "clear leader" in U.S. online retail.

From a survey of 2,400 U.S. consumers, Mahaney wrote, "95% of respondents picked Amazon as their most common go-to website when shopping online, representing an all-time high, as Amazon remains far and away the most popular choice among U.S. shoppers."

Some analysts are more positive about the second half of the year after tariff uncertainty overshadowed the first six months of 2025. Wedbush analyst Dan Ives wrote Tuesday morning that the "stage is set" for tech stock to rally at least 10% in the second half of the year.

"We have barely scratched the surface of this 4th Industrial Revolution now playing out around the world led by the Big Tech stalwarts such as Nvidia, Microsoft, Palantir, Meta, Alphabet, and Amazon," Ives wrote to clients. "In our opinion, after a relatively strong few months navigating tariff and geopolitical storms, now tech stocks are poised to see another 10%+ move higher in the second half of 2025 led by the tech winners in this 'golden age' for the tech world."

Amazon Q1 Earnings Beat; Guidance Disappoints

Amazon stock fell on May 1 after the tech giant offered a mixed outlook for the current June-ending quarter, adding to investor fears about the impact of tariffs. Amazon's profit-driving cloud business also recorded March quarter revenue slightly below Wall Street expectations.

Amazon's overall top- and bottom-line results for the first quarter beat Wall Street estimates. Earnings increased 62% year-over-year to a $1.59 per share while sales grew 9% to $155.2 billion.

But investors were largely focused on Amazon's guidance for the second quarter. Amazon projected $15.3 billion in operating income for Q2 at the midpoint of its range, well below the $17.6 billion in operating income that analysts were projecting prior to the report

Amazon executives told analysts that the company believes it can gain overall retail market share even if tariffs slow consumer spending. But uncertainty was a clear theme in the company's commentary.

Amazon fell in trading following the report but pared losses to close only a fraction lower.

Amazon Market Cap

You can check for Amazon's current stock price here. Amazon's market cap was $2.33 trillion, as of the June 30 market close. Here is how the stock has performed over time:

Time Period Amazon Stock % Gain/Loss S&P 500 % Gain/Loss
Year-To-Date 0 5.5
Previous 12 Months 13.5 13.6
Three Year 106.56 63.9
Five Years 59.05 100.14
Since 1997 Amazon IPO 243,667 631

*Prices as of June 30. 

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