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Guggenheim says Amazon still a buy, gives $950 price target

Amazon revenues miss in 'tough environment': Pro
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Amazon revenues miss in 'tough environment': Pro

Amazon is still a buy despite its revenue miss, according to Guggenheim's Robert Drbul, who is putting a $950 price target on the stock.

That's more than 16 percent higher than the stock's price of $812.29 a share on Friday morning.

"We think from the forecast and the future, we still have 20-plus percent growth in '17 and '18 and even higher growth in the AWS piece of it," Drbul told CNBC's "Squawk Box," referring to Amazon Web Services, the company's profitable cloud computing unit.

Amazon on Thursday reported revenue of $43.74 billion for the fourth quarter, lower than the Thomson Reuters' consensus estimate of $44.68 billion. Amazon Web Services' revenue was $3.536 billion vs.$3.6 billion expected by FactSet.

Not everyone was so bullish on Amazon. Analyst James Cakmak of Monness, Crespi, Hardt & Co. said on "Squawk Box" that he would not buy Amazon until the company can convince investors of its profitability.

Drubl, a Guggenheim managing director and retail analyst, acknowledged in Friday's interview that the company's earnings report was a slight disappointment, but he contended that it was no reason to shed Amazon from stock portfolios.

"I think, from our perspective, we would all love to have Amazon's problems with the level of growth that they're seeing," he said. "It was a little bit lighter than we expected, but it really is far from a thesis-changing result."

Drbul said the "tougher environment" surrounding the company's boost in spending did not lead to immediate returns, which may have contributed to the missed expectations.

Still, Drbul insisted that the revenue and guidance miss did not signal particularly turbulent times for the online retail giant.

"The growth has accelerated and remains very healthy," he said. "We expected the North America ... retail component [to be] roughly 28 percent growth. It came in 25 percent growth. International was 24 [percent]. Still a very, very healthy number, but a few points lighter than, really, what had been the trend."

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