Earnings Beat: Amazon.com, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

It's been a good week for Amazon.com, Inc. (NASDAQ:AMZN) shareholders, because the company has just released its latest first-quarter results, and the shares gained 3.1% to US$179. Revenues were US$143b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.98 were also better than expected, beating analyst predictions by 18%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Amazon.com

Following the latest results, Amazon.com's 53 analysts are now forecasting revenues of US$639.2b in 2024. This would be a decent 8.2% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 21% to US$4.40. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$641.5b and earnings per share (EPS) of US$4.15 in 2024. So the consensus seems to have become somewhat more optimistic on Amazon.com's earnings potential following these results.

There's been no major changes to the consensus price target of US$215, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Amazon.com at US$245 per share, while the most bearish prices it at US$160. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Amazon.com's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2024 being well below the historical 17% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 10% annually. Factoring in the forecast slowdown in growth, it looks like Amazon.com is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Amazon.com following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$215, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Amazon.com going out to 2026, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.