I ran a conservative DCF on AMZN and the results speak for themselves.
AMZN is currently trading at 28.5× earnings and 17.4× operating cash flow both 29% below their 5-year averages of 52.1× and 21.2× respectively. The market seems to be underpricing the business despite revenue growing at +14.2% YoY (TTM). Net income growth of +37.7% and EPS growth of +36.7% are both outpacing revenue and margins are expanding.
It's also trading cheaper than its mega-cap peers on a historical basis. You can see the comparison here: [https://stocknest.app/?tab=compare&tickers=GOOGL,META,AMZN,MSFT&metrics=pocf&period=10](https://stocknest.app/?tab=compare&tickers=GOOGL,META,AMZN,MSFT&metrics=pocf&period=10)
For the DCF, the historical 4Y CAGR comes in at 31.73% but I used just 15% growth and a terminal P/OCF of 19× (vs. the 5Y median of 21.2×). Even with those conservative assumptions, AMZN still comes out undervalued by 25%+.
DCF model: [https://stocknest.app/?tab=dcf&tickers=AMZN&dcf\_metric=ocf&dcf\_growth=15&dcf\_terminal=19](https://stocknest.app/?tab=dcf&tickers=AMZN&dcf_metric=ocf&dcf_growth=15&dcf_terminal=19)
Analysts' price targets over the past 12 months average $307, which is 30% above the current price matching exactly the DCF conservative range. Additionally, the last two months have seen significant insider buying activity
