JPMorgan Forecasts Dramatic Cash Surge for Amazon

Amazon US0231351067

Following a week of significant developments, Amazon continues to command attention on Wall Street. The focus sharpened on Friday, December 12th, when JPMorgan Chase designated the tech behemoth as its top selection within the artificial intelligence sector, accompanied by a striking financial projection. The firm anticipates the company's free cash flow will more than double by 2026. This bullish outlook emerges as Amazon's shares trade near 226 euros, with a growing number of analysts setting their sights on a $300 price target.

The optimism from JPMorgan aligns with a series of positive assessments from other research firms. This consensus is crystallizing around a specific share value. On December 9th, Guggenheim analyst Simeon Siegel initiated coverage on Amazon with a $300 price objective. His analysis suggests that despite facing structural challenges in retail, the company's market dominance and operational leverage provide a sustained advantage. He noted that gross margins are hovering near historical peaks while still retaining room for improvement.

This sentiment was echoed by TD Cowen on December 11th, as the firm reaffirmed its "Outperform" rating and its own $300 price target, citing stable underlying demand trends across Amazon's businesses.

Unpacking the Cash Flow Projection

The core of JPMorgan's analysis, led by strategist Doug Anmuth, presents a compelling case. The bank positions both Amazon and Alphabet as offering the most attractive risk-reward profile in AI for the year 2026. Quantitatively, JPMorgan forecasts a surge in free cash flow from an estimated $24 billion in 2025 to approximately $59 billion the following year.

This anticipated explosion in cash generation is expected to occur even as the tech sector undertakes substantial capital expenditures, with industry experts projecting over $125 billion in spending among the largest firms alone. A key driver is Amazon Web Services (AWS), where JPMorgan predicts cloud revenue growth will accelerate to 23%. Furthermore, margin expansion in the North American retail segment is anticipated, fueled by increased automation and enhanced regional logistics efficiency.

Recent Performance and Forthcoming Catalysts

Amazon's financial momentum was recently demonstrated in its third-quarter 2025 results, released on October 30th. The company reported earnings per share of $1.95, comfortably surpassing the $1.57 consensus estimate. Revenue saw a 13.4% year-over-year increase, reaching $180.2 billion. Since April, the equity has appreciated by roughly 40%.

Market participants are now looking ahead to the next potential catalyst: the fourth-quarter earnings report, scheduled for January 29, 2026. This update will cover the critical holiday shopping period. Commentary regarding Amazon's ongoing investment strategy and the profitability trajectory of its cloud services division will be scrutinized closely. From a technical perspective, the stock is maintaining support levels established in November, with a sustained breakout above $235 seen as a potential gateway to new record highs.