Although UBS remains broadly bullish on Amazon, it’s lowering first-quarter estimates due to tariff headwinds. Analyst Stephen Ju cut his price target on shares to $253 from $272, which still implies 35.3% upside potential from Monday’s close. He also reiterated his buy rating on the stock. Amazon is slated to report first-quarter results Thursday. Ahead of the results, Ju forecasts at least 50% of the goods sold on Amazon are subject to tariffs and will see higher prices. “We anticipate some level of tariff-driven demand destruction due to price elasticity,” Ju wrote in a client note on Tuesday. Due to tariffs, “Consumers therefore might have to make more difficult choices on where to allocate their dollars,” Ju said. The analyst added that tariffs could cause second-order impacts. Exporters to the U.S. likely will see lower revenues that lead them to engage in cost and headcount reduction — which Ju says could also impact employment worldwide and gross merchandise volumes. Nonetheless, Ju noted that as a larger e-commerce name, Amazon is better positioned against the tariffs compared to smaller companies. Year to date, Amazon shares have sold off 14.4%. —CNBC’s Michael Bloom contributed to this report.
