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Amazon’s Relative Strength and Analysts’ Recommendations

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Dec. 4 2020, Updated 10:42 a.m. ET

Relative strength index

For the last 14 days, Amazon (AMZN) has reported a relative strength index (or RSI) of 61, compared to the scores of 21, 54, 64, and 33, respectively, of Yelp (YELP), eBay (EBAY), Alphabet (GOOGL), and Facebook (FB) within the same period.

The RSI measures the changes in and direction of a stock’s price movements. The RSI moves between 0 and 100. If it’s above 70, it indicates that a stock has been overbought. If it’s below 30, it suggests that a stock has been oversold.

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Analysts’ recommendations

Of the 47 analysts covering Amazon (AMZN), 41 have given it “buy” recommendations, one has given it a “sell” recommendation, and five have given it “hold” recommendations. 

Analysts’ stock price target for the stock is $1,095.42, and the median price target for the stock is $1,100. Amazon is trading at a discount of ~11.8% to its median target.

A price target refers to the projected price level of a stock set by an analyst. A price target is the price that, if achieved, yields the highest level of returns from an investment.

Stock return

In the trailing-one-month period, Amazon has generated investor returns of 8.0%. Peers Yelp, eBay, Alphabet, and Facebook have generated investor returns of -15.5%, 5.2%, 11.7%, and 3.2%, respectively.

Short interest ratio

If a stock’s short interest ratio is above 40%, investors expect a fall in its share price. Amazon had a short interest ratio of 1.1% on May 22, 2017.

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