Amazon Stock Up 30%: Is AMZN Still a Buy Before Earnings?

Key Points

• Amazon has jumped nearly 30% in just a few weeks, pushing shares back toward all-time highs.
• However, its stock is now at its most overbought level in more than three years, raising the risk of a near-term pullback.
• With earnings due next Wednesday, Amazon shares could swing either way.

Shares of tech giant Amazon.com Inc NASDAQ: AMZN are currently trading right around $250, having rallied close to 30% in just a few weeks and coming within touching distance of their all-time high. It marks one of the stock’s strongest runs over the past 12 months and is a sharp reversal from the weakness and lethargy seen earlier this year.

For longer-term investors, it will be a welcome turn of pace that feels a lot more like the Amazon stock they’re used to. After trading sideways for months and getting hit hard following February’s earnings report, which saw the company land a rare miss and raise concerns about its capital expenditure, Amazon has been a frustrating stock to own.

Even though the business has so much going for it, and analysts were falling over themselves to call it a Buy, sentiment was stubbornly cautious. The recent rally has changed that.

The big question now is whether Amazon is still a buy, considering its next earnings report is due next week. Let’s jump in and take a closer look.

The Rally Has Strong Foundations

While the speed of the recent move might be noteworthy, the underlying drivers aren’t that hard to spot. One of the biggest shifts has been the rapid improvement in confidence that Amazon’s massive investment in artificial intelligence (AI) is beginning to show signs of payoff. Thanks to bullish comments from CEO Andy Jassy earlier this month, investors are clearly starting to focus on the huge potential payoff rather than the near-term risk.

This narrative was firmly rejected just a few months ago. So it’s fair to think that as further clarity emerges on this, the stock will keep rising.

Strategic developments, such as the acquisition of Globalstar, have added another layer of upside. With the deal now confirmed, investors are leaning into the potential for this to help Amazon accelerate its satellite and connectivity ambitions. It’s also helped reinforce the view that the company is positioning itself strategically for the next phase of growth.

Taken together, it’s easy to see why there’s been such a meaningful shift in sentiment. The stock is no longer being treated as the capital-intensive laggard it was in Q1, but that, of course, means next week’s report will be more heavily scrutinized as a result.

The Technical Picture Is a Little Stretched

In that light, the technical setup is hard to ignore. With the recent pop, Amazon’s relative strength index is now in extremely overbought territory, and at levels not seen in more than three years. Historically, this kind of reading often signals that a stock is due for at least a period of consolidation, if not a short-term pullback. With Amazon shares around the same levels as they were in the middle of last week, we could already be starting to see this take shape.

The thing is, a near-30% rally in just a few weeks is difficult to sustain without some form of consolidation, especially when it pushes the stock to stubborn levels of resistance near previous highs. Investors considering opening or adding to an Amazon position ahead of next week’s report need to keep that in mind. Any hint that the results and commentary do not support this recent optimism could lead to selling.

Analyst Remain Overwhelmingly Bullish

The good news for the bulls is that, on the whole, analyst commentary is almost universally bullish, even after the recent gains. This week alone has seen the likes of Cantor Fitzgerald, Bank of America, and KeyCorp reiterate their Buy or equivalent ratings, with price targets rising to $325.

Considering how much the stock has gained since the start of the month, that 30% in additional targeted upside is about as bullish as it gets, especially with earnings due next week. The more recent analyst updates bode well for investors thinking of getting involved ahead of the report.

The focus is firmly on AWS’s growth potential, where accelerating AI-driven demand and growing visibility into future revenue are reinforcing confidence that the company’s heavy investment cycle is starting to pay off. This isn’t an isolated view either, with multiple firms over the past month pointing to Amazon’s solid fundamentals and clearer monetization of AI spend as key drivers of further upside.

That’s what makes the current setup so interesting. Yes, the stock has already moved sharply higher, and technicals are undeniably stretched. But if there’s one company with the momentum, narrative, and execution track record to justify buying into strength ahead of earnings, it’s Amazon.