Morgan Stanley Raises Amazon Price Target to $350, Cites Under-Appreciated AWS Runway

Morgan Stanley released a report on October 19, 2026, naming Amazon.com Inc (NASDAQ:AMZN) a top pick and raising its price target from $335 to $350. Following this news, Amazon's shares rose more than 5% on Monday.

The investment firm argues that Amazon Web Services' (AWS) growth and profit runway remain under-appreciated by the market. Analysts increased their projected AWS growth rate for 2027 to 47%, up from 41%, and forecast year-over-year growth of 47% and 42% for 2027 and 2028 respectively. The report cites Nvidia's earlier disclosure that 2 million GPUs are headed to AWS as a key catalyst for re-accelerating growth.

Regarding profitability, Morgan Stanley expects AWS to operate as a 'rule of 90' company in 2027 and 2028, with operating margins reaching 42% to 44%. Based on these assumptions, analysts project Amazon could generate approximately $16.50 in earnings per share (EPS) in 2028. Other potential drivers mentioned include greater visibility into Bedrock services, agentic shopping tests during the holiday season, and the ramp-up of robotics in fulfillment centers.

Morgan Stanley emphasized that Meta's launch of Muse does not alter its view of Amazon as a 'key agentic enabler and winner.' The firm believes Amazon's e-commerce infrastructure and loyal user base position it well to monetize agentic commerce.