Amazon.com Inc. (Nasdaq: AMZN) stock is soaring today, and analysts are rushing to raise price targets and ratings.
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The world's largest online retailer showed its muscle by reporting healthy earnings after the close Thursday, handily beating Wall Street estimates.
The news sent shares soaring almost 15% in after-hours trading. AMZN stock was up more than 16% Friday by 1:30 p.m. EDT to $228.59.
The Seattle-based company reported first-quarter sales jumped 34% to $13.18 billion, compared with $9.86 billion in the first quarter of 2011. Estimates were for $12.9 billion.
Net income slipped to $130 million or 28 cents per diluted share, compared to $201 million or 44 cents a year ago. Despite the decline, it was still heads above the mean forecast for 7 cents a share.
Worldwide media sales surged 19% to $4.71 billion and worldwide electronics and other media merchandise swelled 43% to $7.97 billion.
But the number that really triggered a slew of analyst upgrades was Amazon.com's profit margin increase. The company's gross margin widened to 24% from 22.8% for its best year-over-year improvement in years.
"Bulls have been waiting a long time for this gross margin upside and it finally came in the first quarter," Macquarie Equities Research analyst Ben Schachter told Reuters.