Amazon's Optimistic Group-Think

Ahead of Amazon's (AMZN) earnings today, the Wall Street Journal noted that Wall Street analysts haven't been this positive on the stock since the internet bubble:

But the stock trades above $800, having surged about 70% since February. About 90% of analysts who cover Amazon rate the stock a “buy,” the most bullish Wall Street has been on it since the dot-com boom. At least four have price targets of at least $1,000.

Among S&P 500 stocks with more than 5 analysts providing a rating, AMZN ranks 7th on the list, so on both an absolute and relative basis, the Street loves the stock.

Source: Bloomberg

For perspective, here is the full history of AMZN and its ratings:

We can see just how much the Street has changed is opinion on the stock over the past decade. The Bloomberg ranks go from 1 (sell) to 5 (buy), so the current 4.8 consensus rating suggests almost universal buys, and as noted by the Journal, the Street consensus hasn't been that positive since 1999.

But there were only 4 analysts covering the stock at that point, as opposed to nearly 50 now. So the group-think is much more powerful now than it was then.

The company had better deliver on its expectations, because the Street is counting on it at the moment.