CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We lift our 12-month target by $18 to $198, calculated using an EV/EBITDA multiple of 16x (was 15x) against our 2024 adj-EBITDA of $137.0B (up from $132.3B) vs. 12x-30x historical range. We lift our 2024 adj-EPS to $6.45 from $6.13 but lower our 2025 adj-EPS to $7.18 from $7.28. Q4 operating income of $13.2B smashed the $10.4B consensus on revenue of $170.0B (+14% Y/Y), $3.7B above consensus. AWS growth reaccelerated to +13% (approaching a $100B annualized run-rate business) vs. +12% in Q3/Q2, a trend that should continue in 2024 due to easier Y/Y comps and new AI opportunities. In retail, lower transportation costs and AMZN’s supply chain regionalization initiative drove strong margins all year. We expect retail margins to continue to expand in 2024, albeit at a slower pace vs. 2023. Advertising should continue to see strong growth in 2024 (+27% in Q4), buoyed by the recent introduction of ads to Prime Video. One yellow flag to call out is the start of a new capex cycle in 2024, driven by AI investments.