The stock was lower on Monday after Morgan Stanley analysts cut their price target.
Amazon (ticker: AMZN) fell 1.97% to $ 3,358.04. Higher bond yields hit the stock on Monday, as did others fast growing technology stocks. the
Morgan Stanley analysts have lowered their price target from $ 4,300 to $ 4,100. They kept their overweight rating on the stock.
Analysts surveyed by FactSet also rate the stock as overweight, but with a higher average price target of $ 4,153.
“We have written in the past how AMZN’s growing logistics workforce will enable more e-commerce share gains, faster ship speeds (1 day and same day), and new business opportunities (like third party logistics) … but labor costs are increasing “, Wrote the analysts under the direction of Brian Nowak.
The analyst cut his 2021 and 2002 EBIT estimates for Amazon by 16% and 19%, respectively.
Amazon announced in mid-September that it is Hiring more than 125,000 drivers and warehouse workers and pays them an average starting wage of more than $ 18 an hour – and up to $ 22.50 in some places.
The company is in a hiring frenzy. In early September, the company announced it would fill 40,000 business and technology jobs; Since the pandemic began in March 2020, Amazon has hired more than 450,000 employees in the United States.
“Short-term estimates are going down … but from our point of view, it’s also important to remember that rising wages affect all businesses (most recently
(FDX) last week) and AMZN competitors, ”said the analysts.
Barrons reported last week how Labor cost inflation appeared to be biting profit margins at the shipping giant FedEx.
“We recognize that lost profits and declining revenues can affect AMZN’s ability to outperform during this investment cycle,” wrote Morgan Stanley. “In our view, AMZN can be tactically bound by reach until retail sales accelerate again and can exceed expectations” in the first half of 2022.
Write to Joe Woelfel [email protected]