Key Stats for Amazon Stock
- Current Price: $249.70
- Target Price (Mid): ~$820
- Street Target: ~$281
- Potential Total Return: ~228%
- Annualized IRR: ~15% / year
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What Happened?
Amazon (AMZN) stock has done something unusual in April 2026: it has climbed while much of the market has been falling.
Shares recovered roughly 13% off their February low after two major catalysts hit within days of each other.
Bulls argue the market is finally pricing in Amazon’s AI earnings power. Bears warn that a $200 billion capital spending commitment is about to compress margins before it expands them.
The first catalyst came on April 9, when CEO Andy Jassy published his annual shareholder letter and, for the first time, put hard numbers around the AI business. Jassy disclosed that AWS’s AI revenue run rate has already topped $15 billion in early 2026 and that the company’s custom silicon business, Trainium and Graviton chips, has reached a $20 billion annual run rate.
Jassy also wrote that a substantial portion of the $200 billion in planned 2026 capex already has customer commitments, pointing to over $100 billion in commitments from OpenAI alone, with the expectation of monetizing most capacity the following year.
Five days later, Amazon announced a second major move. The company agreed to acquire Globalstar, which powers Apple’s Emergency SOS satellite feature, for $11.57 billion, netting all of Globalstar’s satellite operations, infrastructure, and spectrum licenses to build out Amazon Leo’s direct-to-device capabilities. Shares gained another 3.6% on the announcement.
These gains follow a painful stretch. Per TIKR, Amazon hit a max drawdown of 21.74% on February 13, 2026. The Q4 2025 earnings report that triggered the selloff was not fundamentally weak; Q4 revenue rose 14% to $213.4 billion, with operating income of $25 billion.
But the trailing twelve-month free cash flow of just $11.2 billion disappointed investors expecting more, as capex consumed cash. The stock fell 5.55% on February 5. Q1 2026 earnings are due April 29.
Andy Jassy, Chief Executive Officer of Amazon, framed the long-term case on the Q4 2025 earnings call: “We are seeing strong growth, and with the incremental opportunities available to us in areas like AI, chips, low earth orbit satellites, quick commerce, and serving more consumers’ everyday essentials needs, we have a chance to build an even more meaningful business at Amazon in the coming years, with strong return on invested capital.”
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Is Amazon Undervalued Today?
At $249.70, Amazon trades at 13.0x NTM EV/EBITDA and 32.3x NTM P/E per TIKR data as of April 16, 2026. Neither multiple looks cheap on the surface. But the standard earnings lens misses the structure of Amazon’s current profit cycle.
Amazon generated $139.5 billion in operating cash flow in 2025, per TIKR. Free cash flow, however, collapsed from $38.2 billion in 2024 to $11.2 billion in 2025 as capex surged toward $132 billion. With guidance pointing to roughly $200 billion in 2026 capex concentrated in AWS, FCF will remain compressed in the near term. The bull case is that this spending is converting to billable capacity faster than the market expects.
AWS posted 24% growth in Q4 2025, the fastest rate in 13 quarters on a $142 billion annualized run rate, per the Q4 2025 earnings call. Per Amazon’s Q4 2025 earnings results, full-year 2025 advertising revenue crossed $68 billion, growing over 20% year-over-year.
Both segments carry economics that are fundamentally re-rating Amazon’s profitability away from its low-margin retail roots. TIKR consensus estimates project full-year 2026 revenue at around $808 billion and EBIT at around $98 billion, with EBITDA margins expanding from 23.7% in 2025 toward roughly 26% in 2026.
The risks are concrete. Jassy told CNBC in January 2026 that tariffs have started to “creep” into the price of some items, with Amazon observing some consumers trading down to lower-priced goods and others hesitating on higher-priced discretionary purchases.
In a retail business with mid-single-digit operating margins, a 10% cost increase has few places to go. The North America segment faces this pressure heading into Q1 results.
The Globalstar deal adds a second layer of uncertainty. At roughly 40 times 2026 revenue, the acquisition is dilutive and adds further stress to an already elevated investment cycle.
Direct-to-device services are not expected to begin deploying until 2028, making this a multi-year revenue story on a 2026 balance sheet.
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TIKR Advanced Model Analysis
- Current Price: $249.70
- Target Price (Mid): ~$820
- Potential Total Return: ~228%
- Annualized IRR: ~15% / year
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The TIKR mid-case model prices Amazon at around $820 by December 31, 2030, implying a total return of roughly 228% and an annualized IRR of approximately 15% from today’s $249.70. The two primary revenue drivers are AWS and advertising: AWS at a $142 billion run rate growing 24% per year, and an advertising business that crossed $68 billion in 2025 and continues compounding at over 20% annually. Together, these two segments are structurally shifting Amazon’s earnings profile away from its retail heritage.
The margin driver in the TIKR model is net income expansion from 10.8% in 2025 toward around 15% by 2030, as today’s capex cycle converts to earning capacity and depreciation growth eventually plateaus. The primary risk is that $200 billion in annual capex runs longer than modeled, keeping FCF suppressed past 2027. Tariff-driven retail margin pressure is a secondary risk through 2026.
The TIKR high case prices Amazon at around $1,060 by 12/31/30, assuming faster revenue growth and stronger margin realization. The low case, at around $614, reflects slower cloud adoption and sustained margin headwinds. At today’s price, the mid-case still offers approximately 15% annualized returns over the next four and a half years, with the low case representing meaningful upside.
Conclusion
The single metric to watch at Amazon’s Q1 2026 earnings on April 29 is AWS revenue growth. Q1 2025 AWS revenue was $29.3 billion per Amazon’s own Q1 2025 earnings release. Sustained growth at or above 20% year-over-year would validate the capex thesis. A material deceleration would reopen questions about whether the $200 billion commitment is running ahead of demand.
Amazon is not a cheap stock. But TIKR’s mid-case model suggests the market may be underpricing what AWS and advertising can produce by 2030, particularly if FCF begins recovering as the capex cycle peaks.
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Should You Invest in Amazon?
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Pull up Amazon, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
