Bank of America has reiterated its Buy rating on Amazon (AMZN) with a $275 price target, citing accelerating growth at Amazon Web Services. Analyst Justin Post highlighted AWS's massive capacity expansion, noting the cloud division added 3.9 gigawatts of power in 2025 alone and plans to double that capacity by 2027.

BofA estimates AWS revenue could reach $164 billion in 2026 and $209 billion in 2027, representing potential upside of 2% and 5% to current Street forecasts. The firm attributes this growth to AWS's aggressive power capacity buildout, which has already doubled since 2022 and is projected to exceed 31 gigawatts by the end of 2027.

Despite risks from rising construction costs and a projected $1.2 trillion hyperscaler capex cycle over the next two years, BofA remains optimistic. Post expects sentiment to improve as AWS revenue growth continues, Trainium chip adoption increases, and new AI agreements validate Amazon's lower-cost approach. The analyst also noted that progress in Amazon's proprietary large language model development would be constructive for the stock.