Value
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 4.1 |
| P/S | 8.0 |
| EV/EBITDA | 1.9 |
| Fwd P/E | 5.4 |
| PEG | 4.7 |
| Analyst target | 7.5 |
- ▸Forward P/E: 23.7x
- ▸PEG: 1.83
AMZN · Why this verdict
Why Amazon.com (AMZN) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.3/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Amazon.com's wide economic moat and consistent earnings outperformance—including a 69% positive surprise in the most recent quarter—anchor a long-term constructive thesis, while approximately 17% of upside remaining to the analyst-derived target and a 4.7-to-1 risk/reward ratio make the setup attractive for patient investors willing to weather a near-term momentum pullback.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The franchise carries a wide economic moat and a Piotroski F-Score of 8 out of 9, indicating broad financial soundness across profitability, leverage, and liquidity tests. These quality dimensions, combined with strong returns, suggest the business has compounded advantages across multiple cycles. Quality breakdown | Gross and operating margins expand; Piotroski F-Score is maintained at 7 or above over the next four quarters. | →Stable |
| CounterFree cash flow is only 11% of net income, flagged as a quality red flag, meaning reported earnings substantially exceed actual cash generation; if this gap persists, the high-quality profile on paper may not translate into shareholder-accessible capital, and the wide moat cannot prevent a cash-conversion drag from weighing on valuation. | ||
With approximately 17% of upside remaining to the $287.77 analyst-derived target and a risk/reward ratio of roughly 4.7-to-1 in the bull case, the current price offers a materially favorable setup relative to the identified downside, and the asymmetry bar is met. This is a material move, not a marginal one. Price targets | Price approaches the $287.77 level over the next 12 months; the reward-to-risk ratio remains above 1.5-to-1 as the price advances. | →Stable |
| CounterNegative momentum—evidenced by falling on-balance volume and a momentum reading that has not cleared the minimum threshold for a clean technical entry—and an elevated put/call ratio of 1.51 suggest near-term distributional pressure; if the price drifts lower before recovering, the favorable geometry can erode without any change to underlying fundamentals. | ||
Amazon.com has beaten earnings estimates in three of the past four quarters, with an average quarterly surprise exceeding 30%, including a 69% positive surprise most recently; the sole interruption was a near-zero inline result in February 2026. An average surprise of this magnitude signals that consensus estimates have persistently lagged actual results. Earnings | Earnings estimates are revised upward following continued beats; average quarterly EPS surprise remains above 10% over the next four quarters. | →Stable |
| CounterThe February 2026 inline result (essentially zero surprise) and the wide swing in surprise magnitude—from near-zero to 69%—suggest the beat pattern may be partly driven by lumpy, quarter-specific factors rather than durable guidance discipline; if estimates are reset sharply higher following the exceptional recent beat, the bar becomes meaningfully harder to clear. | ||
Free cash flow represents only 11% of net income, flagged as an earnings quality red flag; the substantial reported earnings are not converting to proportionate cash available for reinvestment or return. Until conversion normalizes, the quality of stated earnings remains a structural concern that limits confidence in the headline profit number. Quality breakdown | FCF-to-net-income conversion rises materially above 11% over the next 12 months, approaching industry-standard conversion rates above 50%. | →Stable |
| CounterA high investment intensity can suppress near-term free cash flow while building longer-term earnings power; the wide moat and Piotroski score of 8 out of 9 suggest the business fundamentals are broadly sound, meaning the low conversion may reflect reinvestment priorities whose payoff is deferred rather than lost—though this cannot be confirmed from the data provided. | ||
Price has pulled back to an RSI of 34 and shows falling on-balance volume, constituting a near-term momentum headwind; the stock remains above its 200-day moving average, and the technical notes characterize the configuration as a pullback within a longer uptrend—not a confirmed breakdown—yet momentum has failed the minimum threshold for a clean technical entry. Momentum breakdown | RSI recovers above 50 and on-balance volume trend reverses higher, confirming the pullback has resolved; momentum clears the minimum entry threshold on the next evaluation. | →Stable |
| CounterNegative momentum, net insider selling of nearly 196,000 shares, and an elevated put/call ratio of 1.51 may be signaling something more persistent than a transient pullback; if distribution continues and the stock loses the 200-day moving average as support, the near-term headwind could deepen materially. | ||
The franchise carries a wide economic moat and a Piotroski F-Score of 8 out of 9, indicating broad financial soundness across profitability, leverage, and liquidity tests. These quality dimensions, combined with strong returns, suggest the business has compounded advantages across multiple cycles.
→StableQuality breakdown
- Expectation
- Gross and operating margins expand; Piotroski F-Score is maintained at 7 or above over the next four quarters.
CounterFree cash flow is only 11% of net income, flagged as a quality red flag, meaning reported earnings substantially exceed actual cash generation; if this gap persists, the high-quality profile on paper may not translate into shareholder-accessible capital, and the wide moat cannot prevent a cash-conversion drag from weighing on valuation.
With approximately 17% of upside remaining to the $287.77 analyst-derived target and a risk/reward ratio of roughly 4.7-to-1 in the bull case, the current price offers a materially favorable setup relative to the identified downside, and the asymmetry bar is met. This is a material move, not a marginal one.
→StablePrice targets
- Expectation
- Price approaches the $287.77 level over the next 12 months; the reward-to-risk ratio remains above 1.5-to-1 as the price advances.
CounterNegative momentum—evidenced by falling on-balance volume and a momentum reading that has not cleared the minimum threshold for a clean technical entry—and an elevated put/call ratio of 1.51 suggest near-term distributional pressure; if the price drifts lower before recovering, the favorable geometry can erode without any change to underlying fundamentals.
Amazon.com has beaten earnings estimates in three of the past four quarters, with an average quarterly surprise exceeding 30%, including a 69% positive surprise most recently; the sole interruption was a near-zero inline result in February 2026. An average surprise of this magnitude signals that consensus estimates have persistently lagged actual results.
→StableEarnings
- Expectation
- Earnings estimates are revised upward following continued beats; average quarterly EPS surprise remains above 10% over the next four quarters.
CounterThe February 2026 inline result (essentially zero surprise) and the wide swing in surprise magnitude—from near-zero to 69%—suggest the beat pattern may be partly driven by lumpy, quarter-specific factors rather than durable guidance discipline; if estimates are reset sharply higher following the exceptional recent beat, the bar becomes meaningfully harder to clear.
Free cash flow represents only 11% of net income, flagged as an earnings quality red flag; the substantial reported earnings are not converting to proportionate cash available for reinvestment or return. Until conversion normalizes, the quality of stated earnings remains a structural concern that limits confidence in the headline profit number.
→StableQuality breakdown
- Expectation
- FCF-to-net-income conversion rises materially above 11% over the next 12 months, approaching industry-standard conversion rates above 50%.
CounterA high investment intensity can suppress near-term free cash flow while building longer-term earnings power; the wide moat and Piotroski score of 8 out of 9 suggest the business fundamentals are broadly sound, meaning the low conversion may reflect reinvestment priorities whose payoff is deferred rather than lost—though this cannot be confirmed from the data provided.
Price has pulled back to an RSI of 34 and shows falling on-balance volume, constituting a near-term momentum headwind; the stock remains above its 200-day moving average, and the technical notes characterize the configuration as a pullback within a longer uptrend—not a confirmed breakdown—yet momentum has failed the minimum threshold for a clean technical entry.
→StableMomentum breakdown
- Expectation
- RSI recovers above 50 and on-balance volume trend reverses higher, confirming the pullback has resolved; momentum clears the minimum entry threshold on the next evaluation.
CounterNegative momentum, net insider selling of nearly 196,000 shares, and an elevated put/call ratio of 1.51 may be signaling something more persistent than a transient pullback; if distribution continues and the stock loses the 200-day moving average as support, the near-term headwind could deepen materially.
Per-dimension breakdown
Quality
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 8.1 |
| ROA | 4.6 |
| Gross margin | 6.1 |
| Op margin | 5.3 |
| Net margin | 6.1 |
| Current ratio | 4.5 |
| FCF quality | 0.9 |
| Moat | 8.2 |
| Piotroski F | 8.9 |
- ▸Earnings quality RED FLAG: 11% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
- ▸Strong Piotroski F-Score: 8/9
Growth
8.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.7 |
| EPS growth | 10.0 |
Momentum
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 7.8 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 6.3 |
- ▸Uptrend pullback (RSI 37) - buy opportunity
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
8.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.3 |
| Analyst rating | 9.0 |
| Price target | 8.8 |
- ▸Analyst upside: 34%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider selling — $51,614,259 (0.002% of mkt cap)
Peer rank
3.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.2 |
| quality rank | 7.2 |
| growth rank | 5.6 |
Technical
8.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.8 |
| support resistance | 9.5 |
| 52w position | 6.8 |
Risk (lower is worse)
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.5 |
| days to cover | 8.8 |
| volatility | 3.7 |
| put call | 6.5 |
| implied vol | 5.3 |
| beta | 5.2 |
| debt equity | 7.8 |
Catalyst
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 8.0 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (7)
- MOMENTUM:5.6>=5.5
- ASYMMETRY:3.2>=1.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:36d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- NEWS:LEGAL
Warning (0)
none
Reward-to-Risk
3.25
Upside
+22.9%
Downside
7.0%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — Beta 1.44>1.3
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:5.6>=5.5. Top dim: Growth at 8.3; weakest: Peer rank at 3.7. No conviction either direction.
The strongest dimensions are Growth at 8.3, Sentiment at 8.1, and Technical at 8.0; the weakest are Peer rank at 3.7, Insider at 5.0, and Value at 5.4. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 3.25 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Amazon.com has beaten earnings estimates in three of the past four quarters, with an average quarterly surprise exceeding 30%, including a 69% positive surprise most recently; the sole interruption was a near-zero inline result in February 2026. An average surprise of this magnitude signals that consensus estimates have persistently lagged actual results.
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P2The franchise carries a wide economic moat and a Piotroski F-Score of 8 out of 9, indicating broad financial soundness across profitability, leverage, and liquidity tests. These quality dimensions, combined with strong returns, suggest the business has compounded advantages across multiple cycles.
Trip ifPiotroski F-Score falls below 6 for 2 consecutive reporting periods.
- P3With approximately 17% of upside remaining to the $287.77 analyst-derived target and a risk/reward ratio of roughly 4.7-to-1 in the bull case, the current price offers a materially favorable setup relative to the identified downside, and the asymmetry bar is met. This is a material move, not a marginal one.
Trip ifUpside to price target compresses below 5% from the current 17%.
- P4Free cash flow represents only 11% of net income, flagged as an earnings quality red flag; the substantial reported earnings are not converting to proportionate cash available for reinvestment or return. Until conversion normalizes, the quality of stated earnings remains a structural concern that limits confidence in the headline profit number.
Trip ifFCF-to-net-income ratio rises above 50% for 2 consecutive quarters.
- P5Price has pulled back to an RSI of 34 and shows falling on-balance volume, constituting a near-term momentum headwind; the stock remains above its 200-day moving average, and the technical notes characterize the configuration as a pullback within a longer uptrend—not a confirmed breakdown—yet momentum has failed the minimum threshold for a clean technical entry.
Trip ifRSI breaks above 50 for 2 consecutive measurement periods.