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JP Morgan says Amazon is a ‘top pick,’ recommends internet giant into its earnings report next week 

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Key Points
  • J.P. Morgan reiterates its overweight rating for Amazon shares, predicting the company will report sales above expectations for its second quarter.
  • The firm's analyst cites the company's Prime subscriber base growth and its third-party marketplace leadership.
Jeff Bezos, Amazon
Lindsey Wasson | Reuters

Amazon shares will keep surging even after its stunning rise so far this year, according to J.P. Morgan.

The firm reiterated its overweight rating for Amazon shares, predicting the company will report sales above expectations for its second quarter.

"Amazon is one of our top picks … Turning to the 2Q set-up, even at all-time highs we like AMZN shares into earnings as company fundamentals & industry trends remain strong," analyst Doug Anmuth said in a note to clients Thursday. “Importantly, we believe there is upside potential to consensus 2Q/3Q revenue estimates, while profit expectations remain in check with less downside risk to numbers than in prior qtrs in our view.”

Amazon shares are down slightly Thursday. Its stock is up 58 percent this year through Wednesday versus the S&P 500’s 5 percent gain.

The analyst estimates the company will report second-quarter sales of $53.7 billion versus the $53.4 billion Wall Street consensus. He cited the successful Prime Day sales holiday, which Anmuth believes “came in ahead of expectations.”

Anmuth reaffirmed his $1,900 price target for Amazon shares.

“We believe Amazon continues to show strong ability to take share of overall eCommerce, and its flexibility in pushing first-party vs. third-party inventory and its Prime offering both serve as major advantages,” he said.

Amazon will report its second-quarter earnings results on July 26, according to its website.

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