Updated Price Targets for Amazon (AMZN) through 2027

 

 

Although Amazon (AMZN) is minus 1% YTD in 2025 as of close on 6/26/2025, it's 1-year performance was +12.14% and 5-year performance was +61.26%, nothing too glamorous.  Individual investor gains or losses will, of course, depend on what price(s) they bought shares at.  Valuation is hugely important when it comes to investment gains/losses.  

When valuating Amazon, the Adjusted Operating Earnings (a metric used for most stocks) does not typically correlate well historically with the stock price.   

AMZN:  Price Correlated with Adjusted Operating Earnings   

Instead, a more reliable valuation metric is the price correlated with operating cash flow (OCF) seen in the chart below: 

AMZN:  Price Correlated with Operating Cash Flow (OCF)   

Since December 2022, the stock price has been following closer to the black line (current valuation), as opposed to the Normal P/OCF (blue line) or the Fair Value Ratio (orange line).  Operating cash flow is projected to increase substantially through FY2027, according to analysts, so my expectation would be for the stock price to increase.  Following closer to the black current valuation line (more conservatively), that would  potentially result in the following year end stock prices and gains from the June 26, 2025 closing price:  

Dec 31, 2025: $236/share (+9%)

Dec 31, 2026: $297/share (+37%)

Dec 31, 2027: $358/share (+65%)

The above target prices may end up on the conservative side if the stock price begins to follow the Normal PE (blue line) or the Fair Value Ratio (orange line).   

Another more plausible scenario that I looked at in the figure below was to use a P/OCF ratio of 19.86x which is conservatively below the orange Fair Value Ratio of 22.07x.  Ending Dec 31, 2025, this resulted in a closing price of $253/sh or a 17% gain.  Ending Dec 31, 2026, this would result in the price potentially reaching $319/sh or a 47% gain. Ending Dec 31, 2027, this resulted in a closing price of $385/sh or a Total ROR of 77.36% and a Total Annualized ROR of 25.61%.  This would be outstanding for a company with 2.31 Trillion Market Cap!  

Either of the above scenarios results in solid double digit gains going forward for AMZN through Dec 31, 2027!!!  I am long AMZN for the foreseeable future as it has a AA S&P Credit Rating, it features a diverse range of services offered, and it has a competitive MOAT in the cloud.   

References: 

Disclaimer: This blog has been created for sharing my personal investment ideas only. I do not receive any compensation for this blog or the content within. I am not an investment advisor or professional. This blog is my own personal opinion and is not meant to be a recommendation of the purchase or sale of any stock or ETF. Please do your own due diligence and research before deciding to purchase any investments of your own



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