How Amazon’s Next Earnings Report Could Get the Stock Moving Higher

Amazon is expected to report second-quarter earnings at the end of July. (Courtesy of Amazon)

Amazon.com stock is practically flat on the year, but that could change for the better after the e-commerce company reports quarterly earnings later this month, says one Truist Securities analyst.

Youssef Squali raised his price target on Amazon to $250 from $226 on Wednesday, which implies a 13% increase from the stock’s closing price of $220.46 on Tuesday. Squali also reiterated his Buy rating on the stock.

Squali wrote in a research note on Wednesday that he expects Amazon to report stronger than expected second-quarter financial results, driven by a resilient North American consumer “virtually unaffected by the macro or tariffs so far.”

Investors have been concerned that if companies increase prices to offset the rising costs of imported goods because of tariffs, consumers would pull back their spending. However, CEO Andy Jassy said in a CNBC interview earlier this week that Amazon “so far not seen prices appreciably go up.”

“We did a lot of forward buying several months ago, and then a lot of our sellers—our third-party selling partners—forward deployed a lot of inventory to avoid some of the issues with the uncertainty around where tariffs are going to settle,” Jassy said.

Still, shares of Amazon have only gained 0.4% this year, compared with the S&P 500’s 5.7% increase in that same span. Squali believes that the company could provide stronger-than-expected guidance later this month, which would help push the stock higher.

Amazon is expected to report second-quarter financials on or around July 31, according to FactSet. Before that, the company could get a boost July 8 to July 11, when it will host its summer Prime Day event—which will also be twice as long as its July 2024 shopping event. Prime Day gives Amazon Prime subscribers access to discounts on products across Amazon’s platform. Investors will be looking for Prime Day updates from management on the earnings conference call.

“In total, we estimate Prime Day could generate $21.4 [billion] in [gross merchandise volume], growing approximately 60% [year-over-year],” BofA Securities analyst Justin Post wrote on Tuesday. Gross merchandise volume is the total amount of merchandise sold on the Amazon platform, including first-party and third-party sales.

Post rates Amazon as a Buy with a $248 price target.

Shares of Amazon were off 0.2% Wednesday to $219.98.

Write to Angela Palumbo at angela.palumbo@dowjones.com