Here’s the thing about Amazon: it’s basically a Chinese import machine wearing a smile. About 70% of the stuff sold on the platform comes from China, which means when tariffs go up, Amazon’s margins go down. And Wall Street just realized this isn’t great.
This week, the analyst community did what they do best—they panicked and started slashing price targets. Wedbush, Morgan Stanley, Citigroup, Deutsche Bank, and a bunch of others all took out their red pens and started marking down their Amazon forecasts. The stock responded by dropping about 5% to around $176 per share, bringing its year-to-date loss to a painful 19%.
Let’s break down the problem. With Chinese imports now facing 145% tariffs, Amazon’s sellers are in a bind. They can either raise prices (which kills sales) or eat the tariffs (which kills profits). It’s basically a lose-lose situation, and CEO Andy Jassy basically admitted as much when he told CNBC that sellers don’t have “50% extra margin” to play with. Translation: this is going to hurt.
Wedbush was particularly brutal, slashing its price target from $280 to $225. The firm also cut Amazon’s Q1 net income estimates by 3% and basically said, “Yeah, we’re not expecting much growth this year.” They’re now forecasting revenue growth between 2% and 6% for 2025—which is basically saying “we have no idea what’s going to happen.”
Deutsche Bank went even darker, cutting its price target to $206 from $287 and suggesting tariffs could reduce 2025 earnings by 15%. That’s not a small number. Deutsche analysts think the tariff situation could also reduce AI spending by Magnificent Seven companies by 10% to 15%, which is another headwind nobody wants to think about.
Here’s the kicker: Amazon is still trading at 32 times earnings, which means it’s overvalued even after the selloff. The stock could go lower depending on how Q1 earnings actually turn out. Speaking of which, Amazon reports Q1 earnings on April 29—so we’ll know soon enough if this tariff situation is as bad as everyone thinks.
The median price target is still $260 per share, which would suggest 47% upside from current levels. But that assumes things don’t get worse, which is a pretty big assumption right now. Most analysts still rate it a buy, but they’re clearly hedging their bets.
The real issue here is uncertainty. Nobody knows how long these tariffs will stick around, how much sellers will pass costs to consumers, or whether Amazon’s advertising business (which has been a bright spot) will hold up if the economy slows down. That’s a lot of unknowns for a stock that’s already down 19% this year.
Bottom line: Amazon’s got a tariff problem, and Wall Street is finally admitting it. The stock might bounce back if tariffs get resolved, but until then, expect more volatility and more analyst downgrades. Welcome to 2026, where trade wars are back on the menu.
