Satellites Can Push Amazon Stock Higher: Barclays (AMZN)
Amazon stock (NASDAQ: AMZN) opened Tuesday’s trading bell at $246 but remains on the back foot in June. In a month alone, AMZN has lost more than 7% of its value as tech stocks are under the lens for overspending on AI infrastructure. Capex is the single most worrying reason for Wall Street giants, as the AI investments have not yet paid dividends.On the heels of the concerns, global investment bank Barclays gave Amazon stock a ‘strong buy’ rating. The note to clients did not mention AI and the Capex, but highlighted the company’s next catalyst that can take AMZN higher in value, and that is Satellites. The bank called it the multi-billion-dollar catalyst that Wall Street is entirely missing while chasing AI and comparing capex.Also Read: Micron Stock Hits All-Time High With 10% Rally: Is It Overbought?Satellites Will Power Up Amazon Stock Next (AMZN): BarclaysSource: Watcher.GuruBarclays wrote in a note to clients that Amazon’s ‘Leo’ satellite, which is a massive low-Earth orbit satellite internet network, can push its stock prospects higher, at a time when tech giants are running behind AI. Ross Sandler, the analyst at Barclays, highlighted Amazon’s major milestone, which is the launch of a commercial satellite as early as mid-third quarter.Barclays argued that the satellite launch will immediately be a competition with Elon Musk’s Starlink. The bank projects that the space internet business could reach over $10 billion annually in revenue by 2030. The analyst also wrote that profit margins could be above 40%, making Amazon stock prime for a rally.Sandler explained that while Starlink built its customer base from scratch, Amazon can cross-promote its satellite internet package services directly to its existing 200 million+ global Prime membership users. Even if the company comes second in the sector, it is still a massive market to tap into. The launch of the internet satellite is incredibly attractive for Amazon, which can change its stock direction.
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