Why AMZN Is Advancing Today

Amazon (AMZN) is climbing 2% after Bank of America predicted that the conglomerate would deliver strong fourth-quarter results on Thursday.

The bank kept a $255 price target and a Buy rating on the shares, which reached a new 52-week high of $242.52 today.

A customer entering an internet retail store, illustrating the convenience of online shopping.

Bank of America’s Views on AMZN’s Q4 Results

The bank predicts that Amazon generated Q4 operating profit of $19.7 billion, well above analysts’ average estimate of $18.9 billion. AMZN benefited from the efficient utilization of its employees and fulfillment system in Q4, according to the bank.

Additionally, the company should get a boost from the strong e-commerce environment in Q4 and the 19%-20% growth of its cloud unit, AWS, as firms’ spending on AI continues to be elevated, Bank of America stated. The 19%-20% increase is in line with analysts’ average estimate.

Another Firm Was Bullish on AMZN Today

Investment bank Benchmark raised its price target on the shares to $265 from $215. Benchmark believes that the company’s Q4 results may exceed analysts’ average estimates. Benchmark is bullish on AMZN’s long-term outlook and kept a Buy rating on the name.

The Recent Price Action of AMZN Stock 

In the last month, the shares have risen 9%, while they have jumped 21% in the last three months.

While we acknowledge the potential of AMZN, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ ALSO 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock

Disclosure: The author owns shares of AMZN but doesn’t plan to sell them in the next 48 hours. This article is originally published at Insider Monkey.