While many companies have benefitted from the pandemic bringing forth the increasing adoption of e-commerce, Amazon has always been laser-focused on pleasing its customers.
Recently, Amazon announced a managed WAN (wide-area network) service, named AWS Cloud WAN, which aids in the seamless development, management, operation, and monitoring of a global network. The company also introduced AWS Private 5G, which will enable enterprises to deploy and scale their 5G mobile network.
Amazon’s AWS enterprise contributes substantially to Amazon’s overall business performance. According to some estimates, the cloud computing market will expand at a compound annual growth rate of 17.9% through 2028, which positions Amazon perfectly for long-term growth.
All the endeavors, coupled with expanding data centers and cloud region, will continue to benefit Amazon in winning clientele in the thriving market.
AWS 2022 OUTLOOK
In 2021 Amazon experienced some headwinds that contributed to the stock’s underperformance in the market. Factors such as many investors who shifted away from the “pandemic stocks” and Amazon’s founder, Jeff Bezos, who stepped down from his role as CEO, resulted in a terrible year for Amazon.
Though Amazon also saw slow revenue growth so far in 2022, it is worth noting tough comps in light of its blockbuster results last year when full-year revenue jumped 38%. In the third quarter, net sales from the AWS segment soared 38.1% to $16.1 billion, revealing a much higher growth rate than Amazon’s overall business.
According to Statista, Amazon held a 32% portion in the cloud-computing market, ending the third quarter with $30.2 billion in cash and cash equivalents.
After recent declines, a large number of tech stocks produced a wide-relief rally on Tuesday, with shares of Amazon (NASDAQ:AMAZON) gaining as much as 3%.
Morgan Stanley analyst Brian Nowak recently raised his price target on Amazon shares to $4,200 from $4,000, keeping an overweight target.
Amazon further earns a Strong Buy consensus rating with an average price target of $4.137.50, according to Wall Street analysts. Shares currently trade at $3,251.08.
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