Prime Day Could Improve Amazon Guidance Come Earnings Report, Mizuho Predicts

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Amazon.com, Inc. AMZN is scheduled to report its second quarter financial results after the maker closes on Thursday. Ahead of the announcement, Mizuho analysts Neil A. Doshi, San Q. Phan and Kosuke Hotta look into the company and assure their model suggests that it should post in-line or slightly better-than-expected revenue and earnings numbers.

With the stock up about 25 percent since the announcement of Amazon’s first quarter earnings, the experts think expectations are high going into the second quarter report.

Mizuho’s Model

According to Mizuho’s note, the firm is projecting revenue of $22.4 billion, above the Street’s consensus of $22.278 billion and guidance of $21.7 billion. The analysts expect CSOI of $650 million, also above the Street and guidance of $100 million - $650 million, as they anticipate AWS will continue to drive further margin upside. Going forward, they expect a “solid 3Q top-line guide on Prime Day.”

On the earnings front, the experts are modeling non-GAAP EPS of $0.91, slightly ahead of consensus at $0.87.

Beyond The Numbers

The report highlights three more key points to pay attention to in the report.

1) Prime Day’s figures: Were they mixed? Analysts believe so. While sales beat the company's biggest Black Friday on record, consumers expressed disappointment regarding the deals offered.

2) Prime update: Growth, Prime video, etc.

3) Emerging market expansion: plans for investing $5 billion to double down Amazon’s presence in India.

Mizuho maintains a Buy rating and $498.00 price target on Amazon.

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Posted In: Analyst ColorAnalyst RatingsTechKosuke HottamizuhoNeil A. DoshiSan Q. Phan
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