Citi says that Amazon may take many months to reverse recent stock declines. Analyst Ronald Josey pulled Amazon off the top list of the firm’s top choices, stating in a note that it may take several months for Amazon to reverse its recent slide. Investors looking to see a rebound in stock prices might have to wait. We believe Amazon will absorb most of the incremental $6 billion costs starting in 1Q and ending at the end 2022. Josey explained that Amazon was being removed from Citi’s NAM Focus List because of macro uncertainties and lacks of immediate catalysts. This is after Amazon shares fell 35% over the past year, which has been a significant underperformance for the wider market. Last month’s weaker than expected earnings by Amazon put additional pressure on its stock. Citi noted that Amazon’s growth could regain its momentum in the second quarter, although a slower pace in consumer spending poses a threat to the stock. We believe Amazon will be affected if consumer demand slows down significantly due to macro. But we also believe Amazon can gain—and hold on to—greater wallet share during this period given its focus on convenience, and we note faster overall delivery times,” Josey wrote. Josey maintains his buy rating of Amazon, and his price target of $4,100 for each share, in spite that uncertainty. The price target for Thursday’s stock close is 91% lower than its closing price. — CNBC’s Michael Bloom contributed to this report.
