Amazon Has 40% Upside, Joseph Carlson Says: 'One of the Best Opportunities'

Amazon (NASDAQ:AMZN) offers one of the market’s best investment opportunities, according to YouTube investor Joseph Carlson, who values the shares at $350, roughly 40% above their recent price.

“I think it’s one of the best opportunities today,” Carlson said in a podcast published Monday.

Carlson, whose main YouTube channel has more than 500,000 subscribers, publishes details of his roughly $1.5 million portfolio. Amazon is his second-largest holding, worth about $182,000.

“I didn’t understand why Amazon sold off as much as it did,” Carlson said of its initial 7% post-earnings drop, which he dismissed as short-term noise after shares recovered within days.

Amazon Has Been Here Before

Amazon generated $168.3 billion from operations over the past year, according to its latest earnings report, but spent so much on infrastructure that free cash flow plunged to negative $42.4 billion.

The company expects to spend about $220 billion this year.

For Carlson, this looks familiar.

During the pandemic, Amazon doubled its logistics network. Cash flow plunged, the stock suffered, and investors worried. Then spending eased, and free cash flow recovered to around $50 billion.

Carlson thought it would keep climbing, to $70 billion or even $100 billion a year.

But just as Amazon was starting to reap the rewards, AI came along and gave it another reason to spend.

He now believes Amazon could generate well over $100 billion annually without the current AI investment surge.

Why Carlson Thinks the Spending Will Pay Off

Amazon’s cloud business gives Carlson plenty of reasons to be optimistic. AWS revenue surged 39% to $46 billion last quarter, while maintaining an operating margin of 38.7%.

And CEO Andy Jassy thinks there’s much more to come. He expects AWS growth to exceed 40% in both 2027 and 2028, and believes it could become a $1 trillion-a-year business within five to 10 years, a prospect Carlson called “insane.”

Carlson also sees room for Amazon to squeeze more profit from its retail business as robots and automated deliveries reduce costs.

“They believe that AI is an investment worth seizing. And I agree with them,” he said.

Prediction Markets Expect Even More Spending

On Polymarket, traders put an 83% probability on Amazon’s 2026 capital spending exceeding $220 billion, up from 51% before earnings. The market has attracted about $27,600 across six contracts. To stay within its $220 billion annual target, Amazon would need to cut fourth-quarter capital spending to roughly $48 billion, down from $75.9 billion in the third quarter.

Amazon shares closed Monday at $245.63, up 2.2%.

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