Mizuho lowered its price target on Amazon stock to $320 from $325 on Monday, citing valuation concerns ahead of the company’s second-quarter earnings report on Wednesday. Despite the cut, the Japanese investment bank maintained an Outperform rating on the AMZN stock, signaling continued confidence in the company’s fundamental prospects.
The $5 reduction reflects Mizuho’s view that Amazon shares have become stretched relative to their historical multiples. The firm noted that shares currently trade at 23 times its 2027 earnings estimate, compared to an average of 34 times over the past three years and 45 times over the past five years.
Mizuho’s cut is notable because it comes even as the firm raised its estimate for Amazon Web Services revenue growth. The bank now projects AWS will expand 33.5% in the second quarter, above the consensus estimate of roughly 31%, and expects 33% growth for all of 2026 and 28% in 2027. The firm cited strong demand from Anthropic and product improvements at Bedrock, which now offers OpenAI models.
The move underscores a broader tension facing Amazon and other artificial intelligence-focused tech giants: rapid cloud-service growth is colliding with massive capital spending plans. Amazon guided to $200 billion in capital expenditures for 2026, a significant jump from $131 billion in 2025, with most of the spending directed toward data centers.
Other analysts have also grappled with the same trade-off. UBS lowered its price target for Amazon to $305, maintaining a Buy rating, due to increased capex estimates. Evercore ISI reiterated an Outperform rating with a $315 target. Wall Street’s average price target sits around $312 to $313, implying roughly 35% upside from current levels.
Analysts are weighing these conflicting signals as they prepare for Amazon’s earnings release. Consensus expectations call for second-quarter revenue of roughly $196 billion, representing significant year-over-year growth, with earnings per share estimated at $1.82. Amazon is scheduled to hold a conference call to discuss results at 5:00 p.m. ET on July 30.
The valuation pressure reflects investor skepticism about whether the company’s massive capex spending will deliver returns commensurate with its current stock price. Mizuho, however, described the shares as very attractive given healthy e-commerce trends and accelerating AWS growth with an improving competitive position—a view that explains why the firm kept its Outperform rating even while trimming its price target.
Sources
- Investing.com — Mizuho’s price target cut, valuation analysis, and AWS growth projections
- MarketBeat — Mizuho’s lowered price target announcement and rating maintenance
- Yahoo Finance — Amazon earnings date and analyst expectations
- TradingKey — AWS growth rates and capex spending details
- The Street — KeyBanc analyst commentary and AWS growth outlook
