Amazon's share price could "easily" hit between $1,800 and $1,900 this year, with market estimates for the company's cloud and retail businesses too low, a top Goldman Sachs analyst told CNBC on Tuesday.
Heath Terry, lead internet research analyst at the investment bank, already has a $1,825 price target on Amazon. But the $1,900 is beyond what Goldman has previously said and represents nearly 23 percent upside to Monday's close.
Terry said that he thinks the e-commerce giant's stock is undervalued even though the already high price could be "hard to swallow" for some investors.
"It's close to $1,600 a share. But when you look at the kind of growth that you are seeing, particularly in their AWS (Amazon Web Services) business, which is over half the value of the company, there's a lot of potential for upside to the current stock price as estimates in that business come up just given the level of investors' sensitivity to that," Terry told CNBC in a TV interview.
AWS is the company's cloud business. Many investors are excited about the fast-growing division that raked in $17.46 billion in revenue in 2017. Operating income from AWS accounted for more than 60 percent of the operating income for Amazon's entire business.
"The big case for Amazon is that they are addressing two of the largest trends in technology right now: the shift of retail details online, and the shift of compute dollars into the cloud," Terry said.
"Amazon is leading on both of those fronts. So anytime you can get a company that's leveraged into two of the biggest growth trends that there are in technology, you want to take advantage of it.
"We continue to believe that estimates for both businesses (cloud and retail) are too low, particularly as you see store closures in the U.S. on the retail side of the business, and particularly as enterprise spending starts to accelerate on the tech side."
Goldman Sachs is not the only company with a bullish outlook on Amazon. Wall Street firm Jefferies said in a recent note that it believed Amazon would reach a $1 trillion market capitalization by 2022.
Shares of Amazon are up over 33 percent year to date.