Amazon Delivers Mixed Quarter, Light Guidance, and Prime Price Hike; FVE Steady at $4,100

We are maintaining our fair value estimate for wide-moat Amazon at $4,100 per share, and despite shares rising 14% after hours, we still view shares as undervalued. We think the highlight of the quarter was Amazon's plan to raise prices in the U.S. on Prime to $139 from $119, beginning on Feb. 18 for new members, underscoring Amazon's pricing power and highlighting Prime as a revenue driver. Meanwhile, Amazon will continue to invest heavily in Amazon Web Services, or AWS, fulfilment capacity and delivery, although we see these beginning to ease in the second half of 2022. Overall, we do not see issues with the long-term story as Amazon remains well positioned to prosper from the secular shift toward e-commerce and the public cloud over the next decade.