The advertising opportunity at
Amazon.com
is just beginning, one Wall Street team argued.
Wedbush analysts led by Scott Devitt maintained their Outperform rating on the retail giant, raised estimates, and lifted their price target to $210 from $180 in a Wednesday report titled “Still Day One For
Amazon
Ads; The Everything Stock.”
Shares rose 0.4% to $152.73 in early trading Thursday.
“Amazon is on pace to generate $46.5 billion of advertising revenue in 2023, and we think the company is well positioned to continue taking share of global digital advertising spending over a multi-year period,” analysts wrote, adding that its “advertising opportunity remains early in its development.”
There are multiple factors driving that opportunity, including the addition of advertising to Prime Video next year, analysts argued. That, in combination with the company’s organic gross merchandise value (GMV) growth, plus upticks in on-platform advertising offers “a sustainable runway of advertising revenue growth well above the GMV growth rate of the core retail business.”
Coming into Thursday’s trading session, the stock has soared 81% this year, and the following one looks bright, too.
“We think Amazon is particularly well positioned for 2024 as retail margins continue to rise, Amazon Web Services accelerates against easing comps, and advertising revenue growth continues to materially outperform the broader digital advertising industry,” they wrote.
Wedbush says the company remains its top pick across internet coverage.
Write to Emily Dattilo at [email protected]
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