Bank of America analyst Justin Post reiterated a Buy rating on Amazon (NASDAQ: AMZN) on July 23, keeping his 12-month price target at $310, which implies a 26.6% upside from current levels. The call comes just days before the company's Q2 2026 earnings on July 30.
BofA lifted its Q2 revenue estimate for Amazon to $198.8 billion and EBIT to $24.1 billion, both ahead of Wall Street's consensus. The bank also raised its AWS revenue growth forecast to 33% year-over-year, a full 5 percentage points faster than the first quarter's pace.
AI demand and margin outlook
According to Post, the bullish case rests heavily on accelerating cloud demand tied to AI. Anthropic-related revenues and OpenAI models running on Amazon Bedrock are driving incremental AWS growth, and the analyst sees AWS operating margins expanding to 34% on a year-over-year basis, supported by stronger capacity utilization and better pricing power.
Not everything points up, though. Post flagged that Amazon could raise its 2026 capital expenditure outlook to as much as $210 billion as memory costs climb. He also warned that AWS margins may narrow sequentially in Q2 as stock-based compensation expenses increase.
The broader cloud sector context matters here too. Alphabet reported results on July 22, and Microsoft is due on July 29, a day before Amazon's own call. Post noted that those peer results will heavily shape investor expectations going into Amazon's print.
Post is far from alone in his optimism. As of the latest data from TipRanks, 46 analysts covering AMZN have issued an average Strong Buy rating, with a consensus 12-month price target of $318.98, pointing to a potential 30.27% gain.
This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security.
