Amazon’s $200 billion AI capex and 28% AWS growth could drive shares to $279, nearing a $3 trillion market cap by 2027.
Amazon (AMZN) trades at $266.32, 12% below its 52-week high of $278.56, despite 15.38% year-to-date gains and 28% growth in AWS, now at a $150 billion annual run rate. The company’s $200 billion AI infrastructure spending has cut trailing free cash flow by 95% to $1.2 billion, weighing on investor sentiment.
AWS must sustain 25%+ growth, and Amazon’s Trainium chips need to deliver margin benefits by late 2026 to justify a $400 share price target by 2027. That would require a forward P/E expansion from 27x to 41x, alongside revenue acceleration. CEO Andy Jassy called AI a “once-in-a-lifetime opportunity” for the company.
Reaching a $3 trillion valuation would require a share price near $279, a 5% increase from current levels. The stock’s beta of 1.468 suggests higher volatility, but capex concerns have capped recent gains.