Shares of Amazon.com Inc. slumped 4.8% in afternoon trading Tuesday, adding to Monday’s 2.8% drop, after UBS analyst Lloyd Walmsley cut his stock price target to $167 from $209, citing “some risks” to the ecommerce and cloud giant’s financial outlook depending no the macroeconomic environment. Walmsley lowered his revenue estimate for 2022 to $523.2 billion from $526.7 billion and for 2023 to $598.7 billion from $615.9 billion. Walmsley kept his rating at buy, however, as his lowered price target still implied about 43% upside from current levels, and his longer-term outlook remained upbeat. “We see risk to the consensus revenue and operating income outlook near term, through for investors with longer-term time horizons, we think the current risk/reward looks compelling,” Walmsley wrote in a note to clients. “We do see margins improving in 2023 as the company cuts fulfillment and logistics capacity, sees COVID costs continue to come out of the P&L [profit-and-loss], benefits from a full year of the Prime price hikes and the fuel surcharges.” Amazon’s stock has tumbled 35.4% year to date, while the S&P 500 has dropped 19.4%.
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