Phillip Capital upgraded shares of Amazon.com (NASDAQ:AMZN) to Buy, raising the price target on the stock to $175 from $120 per share in a note Thursday.
Analysts told investors that Amazon's efficiency enhancements are "bearing fruit," with the e-commerce giant's 2Q23 revenue in line with the firm's expectations while earnings exceeded.
"1H23 revenue/PATMI at 47%/68% of our FY23e forecasts. Earnings outperformance was due to higher-than-expected gross margins," the analysts explained.
"Revenue grew 10.8% YoY, beating top-end of company guidance. AWS was up 12%, and growth seems to have bottomed out," they added.
The firm noted that Amazon's "regionalisation initiative is paying off" due to the fact it "reduced the number of touches for packages by 20% and miles traveled to deliver packages to customers by 19%, resulting in less transportation costs and faster delivery speed."