Amazon’s (NASDAQ:AMZN) stock price hit a new record high of $2,009.78 a share just after market open Thursday, as the stock gained less than 1 percent-giving it close to a $1 Trillion market cap.
The record high comes a day after the e-commerce and cloud-computing behemoth, known for disrupting entire industries, received a bullish call by Morgan Stanley’s Brian Nowak who raised his 12-month price target (PT) on Amazon stock to $2,500 from $1,850, implying a 25% upside from Wednesday’s close.
Nowak said he believes Amazon’s rapidly growing, high margin revenue streams – namely advertising, Amazon Web Services (AWS), and paid subscriptions – will drive higher profitability and continue to push up consensus estimates. Nowak predicts that AWS, subscriptions, and advertising will generate almost $45 billion in profit by 2020 from an estimated $25 billion this year.
The analyst, who maintains an ‘Overweight’ rating on the stock, noted in his research that the $2,500 target reflects Amazon’s improving business mix and his belief that it more accurately represents the company’s long-term potential earnings power.
AMZN shares are currently up 16 points, or 0.78% to $2,013 with a $975 billion market cap. Ticker has been on a tear this year, spiking more than 78% through Wednesday’s close. It has also gained more than 100% the past 52 weeks, compared to the S&P 500’s 18.5%.