Amazon Dropped Last Month: A Wall Street Pro Says It’s Going to Provide 60% Returns

Amazon (NASDAQ:AMZN | AMZN Price Prediction) currently trades near $251.89, while the average Wall Street 12-month price target sits at $328.17, an implied upside of roughly 30%.

Amazon runs the largest US e-commerce operation, the biggest cloud franchise via AWS, a top-three digital ad business, and one of the most aggressive AI infrastructure buildouts anywhere. Its most recent quarter showed AWS growing 37% year over year, its fastest pace in 18 quarters, with AI and custom-chip units each running above a $25 billion annualized rate.

Yet the stock slipped through August and into September even as fundamentals accelerated, and one Street-high target implies far more upside than the consensus figure suggests.

Capex Anxiety Overwhelmed a Blowout AWS Quarter

The single biggest weight on the stock has been capital spending. Q2 cash capex reached $53.1 billion, trailing-twelve-month free cash flow flipped to negative $7.6 billion, and management guided to roughly $200 billion in 2026 capex across AI data centers, custom silicon, robotics, and the Amazon Leo satellite network. All that spend has to be powered, cooled, and networked by somebody, which is exactly the angle we took in a free report on seven AI infrastructure suppliers behind the hyperscaler buildout.

Amazon dropped 7.49% over the past month versus a 1.64% dip in the S&P 500. The selloff was Amazon-specific, driven by capex intensity and returns uncertainty. Headline GAAP earnings were also inflated by a $53.4 billion non-operating gain tied to the Anthropic stake; on a comparable basis, Q2 EPS was $1.88 versus a $1.83 estimate, a modest beat well below the blowout the GAAP line implied.

Loop Capital Sees a $405 Path While Analysts Stay Loaded With Buys

Analyst posture has barely moved. Of 61 rated firms, 15 carry Strong Buy, 44 Buy, 2 Hold, and none Sell. Consensus 2026 EPS has seen 48 upward revisions against a single cut over the past 30 days. The bull side is getting louder.

Sitting at the top of the range is Loop Capital’s Rob Sanderson at $405, which pencils out to roughly 61% upside from the current print. That easily clears the 40% threshold that reframes a target as a high-conviction call. Loop’s thesis rests on three pillars: AWS re-accelerating toward a 20%+ clip on enterprise migrations and high-margin AI workloads across Trainium, Inferentia, and NVIDIA; structural retail margin expansion from regionalized fulfillment and marketplace fees; and a scaling ad engine at roughly 70%+ gross margins.

The supporting data is already visible. AWS backlog reached $496 billion, growing triple digits year over year. Management said the lion’s share of 2027 capacity is already reserved, with meaningful pieces of 2028 spoken for. Advertising grew 26% to $19.81 billion. CEO Andy Jassy told analysts AWS could “very possibly be a trillion dollar annual revenue business for us in time”. The ask is patience across two to three years of heavy spend before monetization catches up.

Amazon Fell Harder Than Its Big-Cap Peers

Amazon’s mega-cap peers held up materially better over the same window. Microsoft (NASDAQ:MSFT) is off 2.07% over the past month at $492.44, with an average target of $572.92 (about 16% upside) on a book of 14 Strong Buy, 38 Buy, 3 Hold. Azure just crossed $100 billion in annual revenue.

Alphabet (NASDAQ:GOOGL) at $332.60 is down 3.19% on the month with a target of $428.07, roughly 29% upside. Ratings run 13 Strong Buy, 45 Buy, 5 Hold, and Google Cloud grew 82% last quarter. It is the closest analog to Amazon’s setup.

Walmart (NYSE:WMT) sits at $105.73 with a $127.42 target, about 20% upside, and slipped 6.43% after cautious tariff-refund reinvestment commentary. Its book: 10 Strong Buy, 27 Buy, 5 Hold, 1 Strong Sell.

Amazon’s 30% consensus upside is the widest in the group before layering on Loop’s 61% Street high, making it the most dislocated name in the peer set.

What the Numbers Show at $251

Amazon trades at $251.89 against a consensus 12-month target of $328.17 built from 61 analysts, 59 of whom rate the stock a Buy or Strong Buy. Year to date, Amazon is up 9.13%, trailing the S&P 500’s 11.15%. Over the past month the stock has fallen 7.49% while the S&P dipped 1.64%. Analyst targets are one input rather than a guarantee, but the revision trend is decisively positive.

Bull and Bear Scenarios for Amazon at $251

The bull case strengthens if AWS keeps compounding above 30% into 2027 as management’s contracted-capacity commentary suggests, if the ad business holds a 20%+ pace, and if the $200 billion capex cycle begins converting into free cash flow by 2028. Those three pillars are what get the stock toward Loop’s $405.

The bear case gains traction if free cash flow remains negative through 2027, if custom silicon adoption stalls while NVIDIA-based rivals take share, or if a tariff-driven consumer slowdown compresses North America retail margins already running near 8%. Anthropic-inflated headline earnings make those risks easier to underestimate.

The setup skews constructive. The AWS backlog, the ad flywheel, and the depth of the buy-side book are notable, and the pullback has widened the risk-reward spread. A return to consensus would deliver a meaningful gain from current levels; Loop’s 60% call sits as the higher-conviction scenario tied to the capex cycle playing out.

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