Amazon Q1 Earnings On Deck: 'Off Kilter' Valuation Vs. Bearish Technicals

Amazon.com, Inc. (NASDAQ:AMZN) will report its first-quarter earnings on Thursday. Wall Street expects $1.36 in EPS and $155.04 billion in revenues as the company reports after market hours.

The stock is up 3.03% over the past year but down 16.26% year-to-date.

Let’s look at what the charts indicate for Amazon stock and how it currently compares to Wall Street estimates.

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Amazon Stock Chart Bearish Ahead Of Q1 Earnings

Chart created using Benzinga Pro

Amazon stock is showing a mixed technical setup, leaning bearish in the near term but with signs of emerging strength. The stock, at $191.85, is trading below its five-day, 20-day, and 50-day exponential moving averages, signaling a strong bearish trend. However, the fact that Amazon stock is experiencing buying pressure despite this downtrend could be an early indication of a potential shift toward bullish momentum.

Looking at simple moving averages, the stock is trading above its eight-day and 20-day levels – $185.08 and $180.46, respectively – which can be interpreted as bullish signals. Still, Amazon stock remains below its longer-term 50-day and 200-day simple moving averages of $193.33 and $199.06, reinforcing a broader bearish trend.

The Moving Average Convergence Divergence (MACD) stands at a negative 1.80, which supports a bearish outlook, while the Relative Strength Index (RSI) at 54.34 places the stock in neutral territory – not yet oversold, but not signaling strong momentum either.

Investors may want to watch for confirmation of a trend reversal before turning bullish, as the current setup suggests potential but not conviction.

Analysts See 25% Upside, Link Says ‘It's All About The 2Q Guide’

Ratings & Consensus Estimates: The consensus analyst rating for Amazon stock is currently a Buy, with a price target of $251.41. Latest analyst ratings from UBS, Oppenheimer and Stifel for Amazon stock suggest an average price target of $240.33 – implying a 25.77% upside from current levels.

Hightower Advisors' Chief Investment Strategist Stephanie Link says investors should focus less on the first-quarter print and more on what comes next. "Amazon will be fine on 1Q – it's all about the 2Q operating profit guide, which is expected to be $17 billion," she said in comments shared with Benzinga via email.

Link remains confident in Amazon's momentum, citing 400 basis points of retail market share gains last quarter and strong expectations for AI growth. "Their CEO was quoted… as expecting triple-digit growth in AI year over year and that ‘AI is moving faster than tech has ever seen,'" she noted.

Valuation-wise, Link pointed out Amazon's current earnings multiple of 23x, versus Microsoft Corp's (NASDAQ:MSFT) 25x and Walmart Inc's (NYSE:WMT) 32x, calling the spread "off kilter."

AMZN Stock Price Action: Amazon stock closed the trading day Wednesday at $184.42, down 1.58%.

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