2 Keys To Satisfying Amazon Investor Appetite

RBC Capital Markets' Mark Mahaney was a guest on CNBC and explained why he believes Amazon.com, Inc. AMZN stock has a 15 percent upside to $950.

Mahaney started off by noting the Street's expectations for Amazon's margins in the March-ending quarter are probably overly aggressive. If analysts start revising their outlook lower then Amazon's stock is likely to react in kind to the downside.

Nevertheless, Amazon could set the tone for the longer-term when the company reports its fourth-quarter results, scheduled after the market close Thursday. The key to satisfying investors appetite is two-fold:

• Demonstrating 20 percent-plus online retail growth in both the U.S. and international markets.
• Demonstrate 40 to 50 percent growth in its Amazon Web Services (AWS).

These are the two categories that could help push Amazon's stock to the analyst's price target.

Political Risk

Mahaney did point out that Amazon faces political risk from President Trump's administration. Perhaps of biggest concern is Trump's proposal for a border tax on all foreign made goods entering the U.S.

The analyst pointed out that there exists the likelihood of a "direct political attack." The analyst didn't explain what is meant by this, but we can assume it's a likely reference to Trump attacking the company perhaps through a Tweet.

However, the likelihood of this happening is small since Amazon is one of the largest employers in the country.