Investors have flocked to Amazon (NASDAQ:AMZN) stock after the pandemic sell-off in the past few months. The sell-off created a rare bargain opportunity in some premium technology stocks in the US. At one point, Amazon, Apple, Netflix (NASDAQ:NFLX), Facebook (NASDAQ:FB), and Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) shares were trading at discounts of as much as 40% to their 52-week high or Wall Street’s target price.
Amazon stock rose 1.52% on Thursday and closed at about $2,400. Leading the rebound from the pandemic sell-off, Amazon shares have risen about 30% YTD (year-to-date). In comparison, Facebook and Alphabet shares have fallen about 10% and 5.0% YTD, respectively. Apple stock has fallen more than 6.0% YTD.
Wall Street sees 20% upside potential in Amazon stock
Amazon has rallied in recent weeks. The stock has risen more than 40% from its pandemic low of $1,676. However, some Wall Street analysts see room for the stock to rally more. On Thursday, Goldman Sachs raised its target price on Amazon to $2,900 from $2,600. The new target price implies over a 20% upside potential for Amazon stock from the current price of $2,400.
According to Goldman, Amazon will report its first-quarter earnings above the consensus estimates. The firm expects the company to forecast second-quarter earnings above the consensus estimates. Notably, the strong earnings and an upbeat outlook will likely drive more investor interest in Amazon stock. Wedbush also expects the company’s rally to continue. Wedbush has a $2,750 target price for Amazon stock.
Amazon’s opportunity amid the pandemic
Many businesses have been impacted amid the coronavirus pandemic. For example, companies like Walt Disney and Comcast have borrowed money to shore up their liquidity. They have faced lower sales and soaring costs due to the pandemic. At Facebook and Google, advertising sales have been weaker. The companies slashed their marketing budgets to cope during the pandemic.
For Amazon, the pandemic has created a boom across its important businesses. Investors are excited about Amazon stock right now. The demand for Amazon’s e-commerce service has spiked. Pandemic lockdowns have encouraged households to shop online. At the same time, the pandemic has boosted the demand for services that rely on Amazon’s cloud.
So far, Amazon stock has risen more than 20% in April.