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.