As the company nears a $2 trillion market valuation, Wall Street analysts remain positive about the future growth prospects for Amazon.

Amazon.com Inc (NASDAQ: AMZN) stock traded around $3,331.00, 7.47% down in comparison to Thursday’s closing price. The dip has been attributed to Q2 2021 earnings results that fell short of analysts’ expectations. As for Q2, Amazon reported earnings per share of $15.23 against $12.22 expected by analysts according to a survey conducted by Refinitiv.

However, Amazon recorded a revenue of $113.08 billion against $115.2 billion expected by analysts according to a survey conducted by Refinitiv. Additionally, the American e-commerce and technology company saw its revenue grow approximately 27% year over year, which was a major drop from last year’s 41% growth. However, conditions have since changed from the coronavirus fear of unknown to vaccines rollout.

Amazon CFO Brian Olsavsky said the unpredictable nature of the pandemic is to be blamed for the notable difference. Furthermore, more people are vaccinated now than at the beginning of the year.

“Our customers are safe and healthy and ordering from us. And we know that there’ll be more vacations or more mobility. They’ll be things that probably people shied away from last year and that’s all good,” Olsavsky said on the call with reporters. “But it does tend to lead them to do other things besides shopping. So we’re just adjusting our run rates in the period that we see that happening.”

Amazon Stock and Company’s Earnings Q2 2021

As the company nears a $2 trillion market valuation, Wall Street analysts remain positive about the future growth prospects for Amazon. According to market analytics provided by MarketWatch, the company has a reported market capitalization of approximately $1.83 trillion as of the time of reporting.

Despite the slowed growth reported and also expected in the coming quarters, a poll on Wall Street analysts by MarketWatch indicates AMZN stocks received an average of a Buy rating.

As for the third quarter, Amazon said that it expects its sales to hit between $106 billion and $112 billion. As a result, the company expects the sales to experience a growth of between 10% and 16% compared to the same time last year.

Additionally, the company said that it expects its operating profit in the third quarter to fall between $2.5 billion and $6 billion.

The slowdown expected in Amazon is similar to other tech companies that have reported Q2 earnings results recently. It has been attributed to the global economic rebound from the coronavirus crisis.

AMZN shares have added approximately 17.96%, 10.5%, and 3.7% in the past year, seven months, and three months respectively through Thursday.

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Steve Muchoki

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