After plunging to a low of $1,626.03 on March 16, Amazon stock has had a fantastic rally. Shares soared by 118% to hit $3,552.25 on September 2. The e-commerce giant started to dive the following day amid a larger mega-cap tech selloff that dragged down the entire stock market. Shares are down 13% for the month.
If you missed Amazon’s March madness, you have another chance to make big money with the e-commerce stock, analysts say.
Amazon jumped more than 2% Tuesday after Bernstein upgraded its rating to ‘outperform’ from ‘market perform. ‘ According to Tipranks.com, all 36 major analysts now have a buy rating on the company.
Bernstein says Amazon’s pullback is an attractive ‘entry point’ for investors who missed the comeback since March. The Bernstein analyst admitted missing his shot to raise Amazon’s target back in March when the pandemic was just getting started.
He said Amazon would continue to receive a boost from premium subscribers and third-party merchants, even beyond the pandemic.
We undervalued the power of being the sole eCommerce demand aggregator. We’ve been watching the fundamental story improve from the sidelines, waiting for a better entry point to get involved.
Amazon stock is up almost 90% from its March low, but the analyst said it’s not too late to buy shares as the pandemic has changed everything.
The use of e-commerce, digital advertising, and cloud have increased during the pandemic. Amazon is a primary beneficiary of these three revenue pools.
Consumers are shopping more online, and this trend should continue in the future. Amazon offers a wide array of products, including groceries. Ordering from its website is convenient, fast, and safe. While many others have struggled in recent months, Amazon continued to add employees and gave better-than-expected third-quarter guidance.
Amazon is now trading at an attractive valuation, with a forward P/E of 57.5. Its five-year PEG is 1.2, which is low for a tech stock.
After begging investors to cash out profits, Jim Cramer told them Monday he believes shares of tech giants such as Amazon and Apple have fallen to attractive levels, and they should start buying. Watch the video below:
This wasn’t day one of the decline, people. We’re now two weeks into a gigantic sell-off and everything’s being thrown away except a handful of lockdown stocks. Better to buy them when they’re down than chasing them when they’re up. I just hope you have some cash on the sidelines to take advantage of the weakness.
Bernstein has a 12-month price target of $3,400 for Amazon, which implies a gain of 12% from current levels.