Key Takeaways
- Amazon jumped 7% today and Microsoft rallied with it, after 10 Ohio towns banned large data centers.
- Amazon, Microsoft and Alphabet can afford to build elsewhere, so local bans won’t slow their AI spending.
- CoreWeave has less room to work around bans, and NVIDIA loses only if fewer data centers get built.
- Analysts expect Amazon’s earnings to nearly double by 2028, and a statewide ban is the risk to watch.
Amazon (AMZN) is up 7% today, and Microsoft (MSFT) is up 6%, the morning after 10 Ohio towns banned large data centers.
Alphabet (GOOG) said today it will invest $15 billion in Malaysia, data centers included, and NVIDIA (NVDA) rose before the open. Smaller AI clouds took the hit, with CoreWeave (CRWV) down 7%.
Plenty of towns left
Two of the bans reportedly touch Amazon. Sunbury’s was aimed at a possible large Amazon project, whose future is now unclear.
On Tuesday’s Mad Money, CNBC’s Jim Cramer said “that won’t hurt Amazon because Amazon can buy its way into new towns.”
He’s right. Amazon expects about $220 billion of capital spending this year, and management says its capacity is sold out through 2027. A ban in one town just means Amazon builds down the road.
Smaller clouds have less room
Microsoft and Alphabet are in the same position. In their latest quarters, Azure revenue grew 48% to $33.2 billion and Google Cloud’s grew 103% to $30.7 billion. Their limit is how fast they can build, and they can build far from Ohio.
CoreWeave can’t spread its bets as widely. Its interest expense more than doubled to $640 million in the second quarter, and it lost $49 million at the operating line that quarter. Its Nov. 10 report should show whether any of its 3.7 gigawatts of contracted power is caught up in local fights.
NVIDIA only loses if fewer data centers get built overall. Its data center revenue rose 117% to $89.0 billion in its latest quarter. Its Nov. 17 report is the first chance to hear whether customers’ sites are slipping.
TIKR tracks 59 analysts on Amazon. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Amazon, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Amazon’s Analyst Ratings
The Street isn’t flinching
Analysts expect Amazon’s normalized EPS to nearly double from $7.17 in 2025 to $13.99 in 2028.
Nothing in Ohio’s results should move those estimates.
Before today, Amazon traded at 24x forward earnings, about half its five-year average of 49x.
At today’s price, it’s about 26x.
Bottom line: a few Ohio towns won’t slow Amazon’s build, and at this multiple, I like the stock.
A statewide ban would be harder to buy around. In an October poll by Ohio Northern University and SurveyUSA, 57% of Ohio adults backed a constitutional ban on new data centers above 25 megawatts.
So what is Amazon stock actually worth?
TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR’s valuation model and see what Amazon could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It’s free to use.
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 of the stocks mentioned. Thank you for reading, and happy investing!
