Amazon slips even as DA Davidson reiterates buy rating, citing AI prowess
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Amazon (NASDAQ:AMZN) shares slipped more than 2% in early trading on Tuesday even as D.A. Davidson reiterated its buy rating on the tech giant, citing its prowess in artificial intelligence, including its recent investment in Anthropic.
Analyst Tom Forte, who also has a $150 price target on Amazon (AMZN), said the recent investment in Anthropic "highlights" Amazon's "strong commitment" to AI, while also improving its ability to compete with the likes of Google (GOOG) (GOOGL) and Microsoft (MSFT) and could likely generate "incremental revenue growth and expense management by exploiting AI."
Forte added that his estimate for Amazon Web Services revenue in 2026 is $141.5B, but if it could generate as much as 20% in sales from AI, it would be much more than "incremental" growth. 
"Therefore, we believe there is a high probability that Amazon can generate an incremental 100 basis points of sales growth in 2026 from AI," Forte added.
Forte also said that generative AI should help Amazon's e-commerce efforts, including its recent updates to Alexa, unveiled on September 20.
Lastly, Forte said that Amazon (AMZN) CEO Andy Jassy's directive of investing as much as $4B in Anthropic suggests he is prioritizing AI and de-emphasizing other areas, such as expanding physical grocery stores.

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