Evaluate Amazon.com (NasdaqGS:AMZN) valuation after major AI chips and cloud trade with Meta and Humanity

Amazon.com (AMZN) is back in the spotlight as it signs a multi-year deal to supply Graviton5 chips for its Meta platform and strengthens its cloud partnership with Anthropic, each centered around large-scale AI workloads.

Check out our latest analysis for Amazon.com.

The recent AI Chip and Cloud announcement comes on top of strong performance with a 30-day price return of 32.43% and a 1-year total shareholder return of 39.68%, suggesting renewed momentum after a mixed performance to date.

If you’re looking beyond Amazon’s AI story, it’s a good time to see if other companies are riding on a similar theme through 38 AI infrastructure stocks.

Even though Amazon stock is up 32.43% in 30 days and trading at $263.99, there is still an estimated 10.65% intrinsic discount on the screen. Are you looking at an overly excited AI hot stock, or are you looking at a market that is just starting to price in future growth?

Most popular story: 41.3% are underrated

Amazon’s most followed story has a fair value of $450 per share compared to the recent closing price of $263.99, and today’s price is still well below what would justify that view.

Amazon is sacrificing short-term profits for long-term advantages in AI infrastructure, advertising, and automated commerce. These investments are already paying off, with margins expected to increase by the end of 2026.

Read the whole story.

Curious about what’s under the $450 number? This story hinges on accelerating earnings, richer profit margins, and future multiples usually reserved only for market leaders.

Result: Fair value is $450 (undervalued)

Read the full explanation to understand what’s behind the predictions.

However, this proposition could be called into question if AI capex does not translate into improved profitability or if cloud and retail competition weakens pricing power.

Learn about the key risks to this Amazon.com story.

next step

Sentiment towards Amazon is clearly divided as both risks and rewards are considered. Take a moment to review the details and weigh the 3 major perks and 1 important warning sign.

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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.

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