Amazon (AMZN, $3,201.91) gets Pivotal price target hike to Wall Street-high

Amazon shares got a price target hike to a Wall Street-high of $4,500 from $3,925, from an analyst at Pivotal Research .

Analyst Michael Levine mentioned that Amazon's advertising was only 5% of revenue, but is a "far greater contributor" to overall non-Amazon Web Services EBIT margins than Wall Street /investors appreciate. “…if advertising was viewed as a stand-alone business unit ... it would represent well north of 300% of 2020E non-AWS EBIT", noted Levine.

Levine kept a buy rating on the e-commerce behemoth’s shares.

According to the analyst, there is "massive upside" to estimates by fiscal year 2024.

Levine also estimated that at least 85% to 90% of the Amazon business is sponsored listings. He recognizes substantial potential in that an advertiser pays for higher placement within the sort order, the user stays on Amazon, and Amazon gets to keep the transaction and transaction data.

According to Tickeron, 

Aroon Indicator for AMZN shows an upward move is likely

AMZN's Aroon Indicator triggered a bullish signal on September 14, 2020. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 344 similar instances where the Aroon Indicator showed a similar pattern. In 249 of the 344 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at 72%.

Current price $3205.56 crossed the resistance line at $3182.41 and is trading between $3284.72 resistance and $3182.41 resistance lines. Throughout the month of 08/28/20 - 09/30/20, the price experienced a -7% Downtrend, while the week of 09/23/20 - 09/30/20 shows a +5% Uptrend.

Technical Analysis (Indicators)

Bullish Trend Analysis

The Momentum Indicator moved above the 0 level on September 30, 2020. You may want to consider a long position or call options on AMZN as a result. In 56 of 79 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 71%.

The Moving Average Convergence Divergence (MACD) for AMZN just turned positive on September 29, 2020. Looking at past instances where AMZN's MACD turned positive, the stock continued to rise in 33 of 47 cases over the following month. The odds of a continued upward trend are 70%.

Following a +5.11% 3-day Advance, the price is estimated to grow further. Considering data from situations where AMZN advanced for three days, in 286 of 396 cases, the price rose further within the following month. The odds of a continued upward trend are 72%.

AMZN may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.

Bearish Trend Analysis

The 10-day RSI Indicator for AMZN moved out of overbought territory on September 03, 2020. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 57 similar instances where the indicator moved out of overbought territory. In 25 of the 57 cases, the stock moved lower in the following days. This puts the odds of a move lower at 44%.

The Stochastic Indicator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.

AMZN moved below its 50-day Moving Average on September 11, 2020 date and that indicates a change from an upward trend to a downward trend.

The 10-day Moving Average for AMZN crossed bearishly below the 50-day moving average on September 17, 2020. This indicates that the trend has shifted lower and could be considered a sell signal. In 3 of 10 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 30%.

Following a 3-day decline, the stock is projected to fall further. Considering past instances where Apple declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 43%.

Fundamental Analysis (Ratings)

Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 83%. During the last month, the daily ratio of advancing to declining volumes was 1 to 1.33.

The Tickeron Profit vs. Risk Rating rating for this company is 3 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 69, placing this stock better than average.

The Tickeron PE Growth Rating for this company is 21 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

The Tickeron Price Growth Rating for this company is 41 (best 1 - 100 worst), indicating steady price growth. AMZN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron SMR rating for this company is 45 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of 

weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.

The Tickeron Valuation Rating of 99 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: AMZN's P/B Ratio (21.40) is slightly higher than the industry average of (3.20). AMZN's P/E Ratio (121.03) is considerably higher than the industry average of (36.21). AMZN's Projected Growth (PEG Ratio) (14.46) is very high in comparison to the industry average of (1.67). Dividend Yield (0.00) settles around the average of (0.08) among similar stocks.

P/S Ratio (4.36) is also within normal values, averaging (4.60).

Contributor

Sergey Savastiouk|Expert

Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.

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