Amazon Market Cap Breaks $3 Trillion for First Time – Analysts: Potential Upside of 14%

Amazon (AMZN-US) has broken the $3 trillion market capitalization threshold for the first time, becoming only the fifth company in history to achieve this milestone. The e-commerce and cloud computing giant saw its stock rise as much as 5.3% on Monday (the 3rd), continuing a powerful rally fueled by last week’s second-quarter earnings report that revealed accelerated growth in its cloud revenue.

Amazon now stands alongside Nvidia (NVDA-US), Alphabet (GOOGL-US), Microsoft (MSFT-US), and Apple (AAPL-US) as one of only five companies globally to enter the 'trillion-dollar club.'

Over the past three months, Amazon’s stock had faced selling pressure as investors grew cautious about companies making multibillion-dollar artificial intelligence (AI) capital expenditures. After hitting an all-time high on May 6, the stock declined to a three-month low last month, falling nearly 18% cumulatively.

However, market concerns eased significantly following last week’s earnings release. Amazon reported that its cloud services division, AWS, achieved its highest revenue growth since 2021, sending shares soaring over 15% in a single day—the largest daily gain in more than 14 years—and increasing its market cap by nearly $400 billion overnight.

This rebound has made Amazon once again the top-performing member of the 'Magnificent Seven' U.S. tech stocks this year. In contrast, the Magnificent Seven index has risen only 2.1% year-to-date, far below the S&P 500’s approximate 10% gain.

Although the rally has lifted Amazon’s valuation from a 17-year low seen at the end of March, current levels remain well below historical averages. Based on estimated earnings over the next 12 months, the stock trades at a price-to-earnings (P/E) ratio of around 25x, representing a roughly 44% discount compared to its decade-long average.

It took Amazon approximately two years to go from a $2 trillion market cap—first reached in June 2024—to crossing the $3 trillion mark, a pace faster than the more than six years it took to move from $1 trillion (first achieved at the end of 2018) to $2 trillion.

Overall, Wall Street analysts maintain a high degree of reliance on Amazon’s long-term prospects. According to Bloomberg data, the average analyst target price suggests the stock still has about 14% upside potential from current levels.