Amazon, Inc. (NASDAQ: AMZN) has made an incredible run in 2017 so far — and many are chasing it still higher. But at some point you have to wonder how high is too high? The stock has climbed about 50% year to date, including 18.5% in this quarter, but it has been slowing down recently.
Instinet recently made a call on Amazon, raising its price target to a Street-high $1,360, implying an upside of roughly 20% from the current level.
Most of this call is based on the firm’s belief that Amazon can perpetually grow SG&A as a dependent on gross rate expansion. Considering product costs are unlikely to ease, a mix shift to higher margin segments could drive gross margin expansion.
Accordingly, Instinet believes that mix shift alone could drive about 1,000 basis points of long-term gross margin lift, thus enabling a $160 billion investment into deepening Amazon’s moat.
Here’s what other analysts are saying about Amazon:
- Citigroup reiterated a Buy rating.
- KeyCorp has a Hold rating.
- Loop Capital has a Buy rating with a $1,300 price target.
- Leerink Swann has a Buy rating.
- Stifel has a Buy rating.
- Cantor Fitzgerald has a Buy rating.
Shares of Amazon were last seen at $1,127.07, with a consensus analyst price target of $1,220.74 and a 52-week range of $736.70 to $1,139.90.