The alarming surge of new coronavirus cases could mean the market is on track for another extended period of volatility and uncertainty, making it very difficult to predict when any sense of normality will resume.
Yet, if any company has shown how to catch the curveball thrown by COVID-19, it is e-commerce giant Amazon (AMZN).
Monness' Brian White — Amazon's biggest bull on Wall Street — believes the company provides "key capabilities, vast global infrastructure and financial strength necessary to support the needs of people and organizations around the world, while also positioning the company as a major beneficiary of accelerated digital transformation." According to the analyst, it "will be ushered in with the aftermath of this pandemic, driving greater use of ecommerce, the cloud and emerging tech.”
What is unique about Amazon’s position, White notes, is how the company has become almost indispensable to both the causal consumer and large organizations. Essentially, almost everyone has relied on Amazon’s services during the pandemic.
The shift to ecommerce has accelerated during the period, with more people shopping online than ever before. Amazon is often the first port of call, and its customers have come to rely on its “user-friendly and frictionless” nature.
That said, Amazon’s offerings for organizations, on top of catering to the everyday consumer, set it apart. While e-commerce is primed to become even more prevalent post-pandemic, so are cloud-based services.
Amazon CTO Dr. Werner Vogel recently said during an online AWS summit that “most organizations will be transforming into a completely cloud-based environment” in 2020 and beyond, a sentiment echoed by White.
“Amazon’s cloud business through AWS has been invaluable to organizations… We believe this crisis will prove to be a catalyst for increased use of the cloud as has been heralded on many quarterly calls over the past couple of months,” summarized the analyst.
White’s confidence in Amazon is rewarded with a price target increase; the figure moves from $2,800 to $3,500. It's now the highest price target on Wall Street for the stock and 22% above Wednesday's closing price. (To watch White’s track record, click here)
Buy ratings are also mainly on display among other analysts, 39, in fact, in addition to 2 Holds and 1 lone Sell. All in all, Amazon has a Strong Buy consensus rating. Yet, the $2,840.75 average price target suggests a modest downside. (See Amazon stock-price forecast on TipRanks)
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