AMZN Stock Draws Bulls As AWS And AI Bets Surge

Amazon (AMZN) rose 7.5% on potential benefits from stricter data-center regulations, while Vistra (VST) fell 13% due to regulatory concerns. Amazon's AWS division reported $46B in Q3 revenue, up 39% YoY, with a $220B investment plan. Vistra faces regulatory risks but has expanded its generation capacity. Both stocks have Strong Buy ratings, with price targets of $324.88 (AMZN) and $204.24 (VST).

The Treasury Borrowing Advisory Committee stated that circular financing in AI is intentional, with tech capital spending expected to reach $1 trillion this year and $1.7 trillion by 2027. The cost of insuring debt for companies like Amazon, Oracle, and CoreWeave has increased significantly, with Oracle's insurance costs surpassing 2008 financial crisis levels.

Amazon's stock rose 7% after 10 Ohio towns banned large data centers, as the company can build elsewhere. Analysts expect its earnings to nearly double by 2028. Microsoft and Alphabet also gained, while smaller competitors like CoreWeave fell. NVIDIA's performance depends on overall data center growth.

Amazon (AMZN) reported strong Q3 earnings with AWS revenue up 39% YoY to $46B and record operating margins. However, stock fell due to negative free cash flow of $42.4B, driven by heavy AI infrastructure spending. The company expects $220B in capital expenditures by 2026. Investors are concerned about the return on these investments, but AWS growth and profitability remain positive.

Voters in 29 U.S. jurisdictions approved measures to restrict data centers, impacting AI infrastructure plans of companies like Microsoft, Amazon, and Google. Texas, Ohio, and Georgia elected governors supporting moratoriums, potentially delaying projects and increasing costs. Shares of data-center operators declined in premarket trading.

Voters in Sunbury, Ohio, approved a ban on large data centers, potentially impacting Amazon's $2 billion project. The move reflects growing community restrictions on AI infrastructure.