It is no secret that the bull market has continues to surge in 2018. It is now almost nine years old, and investors have been trying to figure how to best position themselves for the rest of 2018 and beyond. Earnings season is delivering some serious winners for investors, and companies generally are raising guidance on the heels of tax reform. Included benefits are coming from overseas capital repatriation, immediate capital expensing, accelerated earnings growth and a broader economic growth story.

With the S&P 500 rising over 19% in 2017, it was last seen up over 7% so far in 2018, and that’s with the first month not even fully over. The Nasdaq 100 was last seen up almost 10% for 2018 after less than a full month, and Amazon.com Inc. (NASDAQ: AMZN) was last seen up over 19% this month alone. And that’s before the earnings report and after being one of the best-performing stocks of 2017.

Some companies have seen their stocks rise to the point that they may now be priced for perfection. While investors overlook traditional value metrics because Amazon is such a growth engine that is taking over the country, we have to expect that Amazon shares have become priced for perfection. Analysts have raised ratings and targets extensively ahead of Amazon’s report, due on Thursday, February 1. It seems almost assured that Amazon will have to beat earnings expectations, talk up its 2018 guidance and talk about how aspects of tax reform and the broader economic climate are set to benefit the company in the years ahead.

Note that Amazon recently was featured (along with Netflix, which did deliver big) as one of 10 tech giants landing the most upgrades and target hikes ahead of earnings.

Thomson Reuters consensus estimates are calling for $1.84 in earnings per share and $59.81 billion in revenue from Amazon. For 2018, those consensus estimates are $8.08 per share in earnings (versus $4.32 in 2017), and revenues are expected to rise to $228.8 billion (from $177.3 billion in 2017).

In the climate in which investors and analysts alike have not had to consider about worrying how high Amazon’s forward price-to-earnings (P/E) ratio is, it should be anticipated that this will be a difficult report to interpret because of the acquisition and integration of Whole Foods in 2017. And Amazon’s AWS keeps beating expectations. The reality is that analysts often have a hard time integrating the costs and benefits of model-changing acquisitions.

Whether Amazon will be a big winner of tax reform remains to be seen. Its 2017 estimated tax rate is 35% and was over 36% in 2016. That sounds like there is a huge win if the corporate tax rate is going to drop to 21% under the new laws. The problem is that against massive revenues, Amazon’s 2017 pretax income is only expected to be $3.3 billion (Thomson Reuters), but that is called to rise to $10.2 billion by the end of 2019.

Amazon’s analyst calls and higher targets all seemed to drive the shares each time to new highs in 2018 even if the calls were very similar. Amazon’s market cap is now about $680 billion. These are some of the top analyst calls seen year to date:

• Citigroup (Buy) raised its target to $1,600 from $1,400 on January 29.
• Wedbush (Outperform) has a $1,285 price target from January 29 that is still under the current price.
• Morgan Stanley (Overweight) raised its target to $1,400 from $1,250 on January 26.
• D.A. Davidson (Buy) raised its price target to a street-high of $1,800 from $1,500 on January 25.
• SunTrust Robinson Humphrey (Buy) raised its target to $1,400 from $1,270 on January 12.
• Stifel (Buy) raised its price objective to $1,425 from $1,315 on January 11.
• Piper Jaffray (Overweight) raised its target price from $1,200 to $1,400 on January 9.
• UBS (Buy) raised its target price from $1,250 to $1,440.
• Oppenheimer (Outperform) raised its target price to $1,450 from $1,330.
• BMO Capital Markets (Outperform) raised its target to $1,600, above the prior street-high of $1,525.

Amazon has a consensus target price above $1,355, but that is now less than the current share price. That was closer to $1,275 just 30 days earlier. If Amazon is going to run more after earnings, Wall Street analysts are going to be out in droves raising their big price targets.

Again, Amazon is expected to report earnings on February 1. The growth story has been so massive that any bad news is unlikely to be well received by investors, even if a drop might just give the rest of the world a chance to buy more shares. Stay tuned!

Amazon shares closed trading at $1,417.68 late on Monday, in a 52-week range of $803.00 to $1,431.39.

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