UBS Raises Amazon Price Target to $348 Citing Underestimated AWS Margins

UBS has raised its price target on Amazon.com, Inc. to $348 from $318 while reiterating a Buy rating ahead of the company's third-quarter earnings. Analyst Stephen Ju stated that Wall Street consensus underestimates future profitability for Amazon Web Services, projecting AWS operating margins will reach 46% by 2027 compared to the consensus estimate of 38%. Despite investor concerns over artificial intelligence capital expenditures potentially topping $300 billion by 2027, UBS expects AWS to add roughly $80 billion in incremental revenue alongside $20 billion in depreciation and amortization.