New Agreement Heightens Optimism Surrounding Amazon
Amazon.com Inc.s (NASDAQ:AMZN) announcement days ago that it signed a series of multiyear agreements with global automaker and mobility provider Stellantis N.V. (NYSE:STLA) is helping energize an investment community that already expects the company to rocket into the stratosphere in 2022.
Indeed, some analysts have gone public with their belief the stock will reach as high as $4,500 or even $5,000 a share in the next 12 months. The stock closed on Friday at $3,251.08.
The just-announced agreements will transform the in-vehicle experience for millions of Stellantis customers and advance the mobility industrys transition to a sustainable, software-defined future, Amazon said in its statement.
Stellantis will accelerate its shift to becoming a sustainable mobility tech company through this relationship, which involves Amazon Devices, Amazon Web Services and Amazon Last Mile. The two companies will collaborate to deploy Amazons technology and software expertise across Stellantis organization, including vehicle development, building connected in-vehicle experiences and training the next generation of automotive software engineers. Together, the two companies will create a suite of software-based products and services that seamlessly integrate with customers digital lives and add value over time through regular over-the-air software updates.
Amazon CEO Andy Jassy noted that over the past two decades, the company has "built the technology, expertise, and culture of innovation to be a world leader in cloud computing, artificial intelligence and machine learning."
"Weve used these capabilities to make life better for customers around the world through products and services like Alexa, Kindle, and Fire TV, and with AWS weve helped thousands of companies transform themselves and their industries. Were excited to collaborate with Stellantis to transform the automotive industry and re-invent the in-vehicle experience, he said. We are inventing solutions that will help enable Stellantis to accelerate connected and personalized in-vehicle experiences, so that every moment in motion can be smart, safe, and tailored to each occupant. Together, we will create the foundation for Stellantis to transform from a traditional automaker into a global leader in software-driven development and engineering."
Stellantis CEO Carlos Tavares also commented on the deal.
Working together with Amazon is an integral part of our capability building roadmap, based on both developing internal competencies and decisive collaborations with tech leaders, and it will bring significant expertise to one of our key technology platforms, STLA SmartCockpit, he said. By leveraging artificial intelligence and cloud solutions, we will transform our vehicles into personalized living spaces and enhance the overall customer experience, making our vehicles the most wanted, most captivating place to be, even when not driving.
The announcement gives still more credence to the predictions by some analysts of great things ahead for Amazon in the months to come. For example, Joe Tenebruso of The Motley Fool recently suggested that Amazon stock could soar to $5,000 this year. Among his suggested reasons: the continued growth of online retailing, the global cloud computing market and the market for digital advertising. Indeed, he commented that the stock looks like a coiled spring."
"Pandemic-related gains drove a stunning 76% surge in the online retail giant's share price in 2020," he said. "Then its stock essentially treaded water last year on overblown fears that its growth could slow. Now, Amazon once again appears ready to break out to new highs.
Less than two weeks ago, Monness Crespi Hardt analyst Brian White set a price target for the stock at $4,500, which would represent a 33% return. As he told TheStreet, Amazon is uniquely positioned to exit this crisis as one of the biggest beneficiaries of accelerated digital transformation.
This article first appeared on GuruFocus.
