Wall Street Firms Are Going Bullish On Amazon

investors are waking up on Monday to various Wall Street research firms who all published bullish reports on the company ahead of its second quarter print. Amazon is scheduled to report its second quarter results after Wednesday's market close.

the crowd-sourced earnings and economic rating platform is expecting the company to lose seven cents per shares (based on 63 estimates) on revenue of $22.462 billion. This compares to the Wall Street consensus estimate calling for the company to lose 13 cents per share on revenue of $22.278 billion. Here is a summary of what analysts at Bank of America, Bernstein, Cowen and Wedbush are saying about the e-commerce giant.

Justin Post of Bank of America commented in a note that he is expecting Amazon to report "stable" revenue and unit growth in the second quarter. The analyst is also expecting Amazon's AWS segment to report results (and issue an outlook) that confirm the division's acceleration. However, the analyst did caution that a key risk in every quarter for Amazon is "potential investment spending that is hard to predict" and may come in more than what the Street is expecting. Nevertheless, the stock still remains a "top idea" as Prime continues to gain traction, AWS will show revenue growth acceleration while AWS' valuation suggests Amazon retail trades at a discount, and, potential margin upside. Shares remain Buy rated with a price target raised to $535 from a previous $475.

Carlos Kirjner of Bersnstein commented in a note that calling quarters for Amazon is "extremely hard" and "not our game" given the belief that it may be impossible to collect enough data (including macro, Google trends, channel checks, etc) to accurately project Amazon's quarterly revenues or profit. Despite that, Kirjner stated that Wall Street's estimates "are off" and his revenue and margin estimates for the second quarter, for full year 2015 and full year 2016 are "way above" the Street's. As an example, the company is estimated to report second quarter revenue of $22.86 billion, approximately two percent higher than the Street's estimate. "Our best guess is that the Street is underestimating the reacceleration of AWS revenues, the trajectory of International EGM revenues, the ongoing improvement in 1P product gross margins, and the improvement in fulfillment expenses relative to the growth in retail gross profits," Kirjner argued. "It is not really our game, but our view is that Amazon is likely to beat the quarter and trade up." Shares remain Outperform rated with an unchanged $600 price target.

John Blackledge of Cowen commented in a note that Amazon is "winning" in large Retail and Tech markets. In fact, the analyst even suggested the company will become the number one US Apparel retailer by 2017 while the company's AWS segment will assume a "leadership" position in the "fast-growing" Public Cloud market. Blackledge continued that Amazon's "long-game" investment philosophy within the $2.3 trillion retail market is "increasingly paying off" with various data points suggesting strong purchaser growth in several large US Consumables categories. In addition, AWS was the highest-rated Public Cloud vendor ranking number in average annual spend and spending growth. Shares remain Outperform rated with a price target raised to $585 from a previous $425.

Michael Pachter of Wedbush commented in a note that he is expecting Amazon to report "solid" second quarter revenue and profit growth due Prime and AWS's successes. Pachter is even expecting upside to consensus revenue estimates due to growth in Prime revenues driven by additional media options, same-day fulfillment options, higher average Prime pricing. At the same time, AWS has now become a "significant part of the business" with new features that hint of a "dramatic profit growth" in the coming years. Shares remain Outperform rated with a price target raised to $575 from a previous $435.