Amazon Revenue Beats But Amazon Web Services Cloud Business Growth Misses

Viewing 15 posts - 1 through 15 (of 17 total)
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  • #21383
    ThePitBoss
    Participant

    Retail monster Amazon.com reported mixed second quarter earnings…

    [article]1632[/article]

    #21406
    ThePitBoss
    Participant

    Bank of America Reiterate Buy rating Increase PO to $2,350

    “A mixed quarter, with deceleration in AWS & margin pressure but accelerating unit & revenue growth. We got much needed visibility on the big investment in 2019 and we prefer the (old school) market share growth in units to higher retail margins in the near term. Valuation for Amazon is all about the long-term TAM, and we reiterate our Buy rating and increase our PO to $2,350 based on higher top-line estimates and unchanged multiples for our SOP analysis…While higher costs are understandable, AWS revenue & op. income were below estimates & the one real blemish in the Q, in our view. AWS remains lumpy, and Amazon continues to add more cloud dollars than peers.”

    #21407
    ThePitBoss
    Participant

    Evercore ISI Reiterate Outperform rating

    “While AMZN’s investment thesis was migrating to one of growing profitability from strong top-line growth, we think this print highlights that AMZN’s revenue growth acceleration story is far from dead. In sum, though the 3Q19 OI guidance was somewhat disappointing, we would be buyers of any weakness as long as top line trends remain intact.”

    #21408
    ThePitBoss
    Participant

    Stifel Reiterate Buy rating

    “We support the company’s investments in faster shipping, AWS, advertising services and international, which we expect to persist over the next several quarters. We believe one-day shipping will allow Amazon to widen the convenience gap versus peers. We are increasing our FY:19 revenue forecast as we expect continued strength in Online Stores, and lowering our FY:19 operating margin forecast to reflect the company’s incremental investments in strategic areas.”

    #21409
    ThePitBoss
    Participant

    Barclays- Overweight rating, price target to $2,180 from $2,050

    “AMZN reported revenue 1% above and operating income 17% below consensus and guided similarly above on revenue and below on OI. Retail revenue and unit growth accelerated on the 1-day delivery push, but were partially overshadowed by the AWS revenue and OI miss. We are not overly concerned with 2Q but given the positioning heading into the print, we wouldn’t be surprised to see additional weakness. The long term story is improving on retail revenue acceleration, and AWS continues to add more dollar share than Azure/GCP combined, despite missing consensus.”

    #21410
    ThePitBoss
    Participant

    Deutsche Bank Reiterate Buy rating

    “We think the retail and overall revenue acceleration in 2Q results outweighs any of the negatives around margin disappointment and soft AWS results, which were in line with our below-consensus estimates and our preview that Street AWS numbers looked aggressive and our recent note focusing on AWS Cloud Partner changes…We like Amazon’s move to one-day, despite the near-term investing refining the logistics architecture and absorbing higher shipping costs, which over time we think can grow into significant efficiencies reducing per-unit shipping costs closer towards 2-day levels while increasing sales frequency, loyalty and deepening competitive moats.”

    #21411
    ThePitBoss
    Participant

    Goldman Sachs Conviction list buy rating

    “While the deceleration at AWS will raise some concerns, we continue to believe we are still relatively early-stage in the shift of workloads to the cloud, the transition of traditional retail online, and the development of the advertising business. With revenue growth accelerating, we continue to believe AMZN represents one of the best risk/rewards in Internet and remain Buy-rated (CL) with a 12-month price target of $2,400.”

    #21412
    ThePitBoss
    Participant

    Morgan Stanley Reiterate Overweight rating

    “AMZN’s ~1% better than expected total 2Q revenue and 3% better than expected 3Q revenue guidance (at the top-end) highlight how the budding 24-hour shipping offering is leading to incremental demand…immediately. We see this as a multi-quarter (potentially year) tailwind to growth as the company is still rolling it out in the US (even as N. America retail revenue came in 2% better than expected) and looking into ’20 and beyond we expect a larger push in international markets to driver faster growth there.”

    #21413
    ThePitBoss
    Participant

    UBS Reiterate Buy rating

    “As we digest AMZN’s Q2′19 EPS report, there was some noise (especially against heightened investor expectations) in terms of Q2/Q3 profitability (investments behind multiple long-term growth drivers in logistics/fulfillment, cloud & marketing) but the main narrative was that the flywheel drivers of Amazon’s ecosystem demonstrated pronounced strength (especially its core eCommerce business). Looking back across Amazon’s history, we remain convinced short-term investments remain a driver of long-term growth against wide addressable markets. We continue to reiterate our stance that AMZN is a core holding within our coverage universe to gain exposure to secular growth trends in eCommerce, cloud computing, media consumption, digital advertising & AI voice assistants.”

    #21414
    ThePitBoss
    Participant

    Citi Reiterate Buy rating

    “Consistent with our preview, Amazon’s 2Q19 results were mixed, with solid Retail revenue offset by slightly slower AWS growth and Operating Income that came in below forecasts and at the mid-point of the guidance range. Core N.A. Retail rev growth accelerated to +23% y/y vs. 19% in 1Q as did Int’l Retail. As we expected following the Microsoft Azure result, AWS rev growth decelerated to +37% vs. 41% in 1Q. The high-end of mgmt’s 3Q OI guide is in-line w/ buy-side expectations and reflects investments in 1-Day delivery and S&M. All told, we again find these results as good but not great.”

    #21415
    ThePitBoss
    Participant

    J.P. Morgan – Overweight rating, price target to $2,300 from $2,200

    “Overall, the AMZN narrative has shifted back more toward top-line growth in 2019 as we expected, but the magnitude of acceleration & accompanying investment spend are both bigger than we projected. Still, we believe investors will prefer the trade-off of profits for growth & we like how AMZN continues to raise the bar in online retail… AMZN remains one of our top picks and is on our US Equity Analyst Focus List.”

    #21416
    ThePitBoss
    Participant

    Credit Suisse Outperform rating, decreases price target to $2,225 from $2,250

    “As we noted before, we like this offensive stance as it puts greater distance between Amazon’s consumer value proposition and that of its competitors. Hence despite short term dip in operating income we submit that this augers potentially faster GMV growth in the out years and a steeper FCF ramp as a result. Our price target decreases modestly to $2225 vs prior $2250.”

    #21417
    ThePitBoss
    Participant

    RBC Outperform rating, price target to $2,250 from $2,300

    “AMZN posted mixed Q2 results—Revenue was above Street, while Operating Income came in below RBC/Street. Fundies were mixed —Revenue growth accelerated (21% Y/Y organic) and Gross Margins expanded (64 bps Y/Y), but Operating Margin contracted (78 bps Y/Y). Reiterating Outperform and lowering PT to $2,250 from $2,300.”

    #21418
    ThePitBoss
    Participant

    [color=green][b]Mizuho Buy rating, raises price target to $2,200 from $2,080
    [/b][/color]
    “AMZN reported strong revenue growth, but unlike prior quarters, operating income came in below consensus. Similarly, revenue guidance was a beat due to strong growth from 1-day Prime shipping but operating income came in well below consensus on increased investments in Prime and AWS. Despite the near-term cost headwinds, we remain confident about Amazon’s ability to gain market share and operating efficiency over time.”

    #21465
    Truman
    Participant

    The chairman and chief executive of Amazon.com Inc. Jeff Bezos has sold 968,148 shares worth $1.84 billion over the past three days

    Disclosures made in Securities and Exchange Commission filings late Wednesday night showed

    According to Forbes, this may be his largest-ever stock sale in dollar terms. Bezos, the founder of space exploration company Blue Origin and owner of The Washington Post, sold the stock in conjunction with a pre-arranged 10b5-1 trading plan, the SEC filing said.

    Bezos remains by far the e-commerce and cloud giant’s largest shareholder, as he still owns 58.1 million Amazon shares, SEC filings show, which at current stock prices would be valued at about $107.8 billion. That would still make Bezos the world’s richest human, as the Bloomberg Billionaires Index had Microsoft Corp. MSFT, +1.31% co-founder Bill Gates worth $107 billion through Wednesday.

    Earlier this year, Bezos’s divorce settlement had MacKenzie Bezos receiving 25% of their jointly held Amazon stock, or 4% of the shares outstanding. At the time, that made MacKenzie the fourth wealthiest woman in the world, according to the Bloomberg Billionaires Index.

    Amazon’s stock fell 0.7% in afternoon trading Thursday, reversing earlier intraday gains of as much as 1.7%. That puts the stock on track to suffer a six-session losing streak, in which it has shed 7.3% in the aftermath of disappointing second-quarter results. The timing of Bezos’s share sales have worked out so far, as the current price is well below the weighted-average price that the shares were sold:

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