This is Citi Research’s Favorite Internet Stock

Amazon shareholders have something to be excited about.

Citi Research has reiterated its optimistic opinion on Amazon with a “buy” rating and predicts that Amazon will continue to see strong growth.

Citi Research analyst Mark May wrote in a note to clients on Friday, “We remain bullish on the consumer Internet sector, especially near term considering that a positive, tax reform fueled, business climate should benefit the end-markets of the companies we cover.”

He went on to say, “Amazon moves up a spot to become our top-ranked pick as we see the combination of >30% topline growth, margin expansion, and 20x ’19 FCF as a compelling mix.”

The analyst increased his price target on the stock from $1,250 to $1,450. This is an increase of 16% compared to Thursday’s closing price.

According to May, the e-commerce giant will be capable of increasing its operating profit margin to nearly 10 percent in three years from the current 6 percent level due to growth in its Amazon Web Services and advertising businesses.

May remarked, “In 2018 we expect continued expansion in newer categories (e.g., healthcare/pharma) and moves to integrate Whole Foods into the core Prime offering.”

Last year shares of Amazon climbed 56%.

Disclaimer: We have no position in Amazon.com, Inc. (NASDAQ: AMZN) and have not been compensated for this article.

Sofia Vida

Sofia has been writing for major news outlets for over 15 years. In her spare time she enjoys hiking, walking her dogs, and going to concerts.

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