Following a strong performance from the “Magnificent 7” stocks last year, 2024 has presented a mixed bag. While technology giants like Apple (NASDAQ: AAPL) and Tesla (NASDAQ: TSLA) are experiencing downturns, Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Alphabet (NASDAQ: GOOG), and Meta Platforms (NASDAQ: META) continue to surge ahead. Notably, Amazon has risen nearly 19% year-to-date, moving closer to its all-time high set in July 2021. Let’s take a deeper look at the potential trajectory for Amazon’s stock in 2024.

Analysts are optimistic about Amazon, with a mean target price of $202.49, indicating a 12% increase from previous closing prices. The highest target price of $230 suggests a potential upside of 27.2% over the next 12 months. Consistently, multiple brokerages have identified Amazon as a top pick for 2024, granting it a consensus rating of “Strong Buy,” making it the standout among the “Magnificent 7.”

In 2023, Amazon reported record-breaking net profits and operating income, with fourth-quarter figures significantly surpassing previous records. Additionally, the company’s Q1 guidance hints at continued growth, with expected revenues between $138 billion and $143.5 billion, and operating income projected between $8 billion to $12 billion, indicating substantial growth compared to the previous year.

Several factors contribute to the optimistic outlook for Amazon’s stock. Stable top-line growth, robust advertising revenues, investments in generative AI, and emerging business segments like Amazon Business and its pharmacy division all bolster Amazon’s revenue prospects. Furthermore, the company’s focus on efficiency and operating leverage is expected to enhance profitability and cash flows. With a reasonable price-to-earnings multiple and strong earnings growth projected for 2024, Amazon’s stock appears poised for further ascent, despite its significant gains this year.