Amazon's Q1 Drivers Are Setting Up Well, According To Bob Peck

Bob Peck of SunTrust Robinson Humphrey believes that Amazon.com, Inc. AMZN shares are unlikely to outperform peers until there is greater visibility into margin expansion opportunities.

Peck maintained a Neutral rating on the company, while raising the price target from $600 to $625.

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Q1 Drivers

“Amazon is likely to continue to deliver strong top line growth driven by the Prime flywheel, higher 3P adoption, secular growth at AWS, and easy YoY comps,” the analyst mentioned.

However, Peck expects modest margin expansion for the company in 2016, as compared to the consensus expectations, primarily due to management being more focused on long term growth, rather that driving significant near term profits.