Amazon.com Inc's shares opened 9 percent higher, just shy of a record high, after strong profit margins at the world's largest internet retailer surprised Wall Street.
At least 13 brokerages raised their price targets on Amazon's stock after the company reported fourth-quarter gross profit margins of 24 percent on Tuesday, higher than Wall Street expectations of about 22 percent.
Shares of the Kindle maker were trading at $275.66 in early trade on the Nasdaq after touching a high of $284.20. The stock hit a record high of $284.72 on January 25.
"We can't help but stop and wonder whether the Amazon bull case has now pivoted from one of revenue growth to one of margin expansion," Barclays Capital analysts said in a note.
The analysts raised their target price on the stock to $260 from $245.
"Amazon has outpaced the ecommerce market, retailers and even internet leaders like Google Inc meaningfully," said Benchmark Co analyst Daniel Kurnos, who raised his price target to $330 from $310.
J.P.Morgan Securities, which said Amazon's results suggested the retailer could continue to expand gross margins, raised its target price by $88 to $333.
Amazon's fourth-quarter revenue jumped 22 percent from a year earlier, but fell short of analysts' expectations. However, the company reported strong holiday sales and lower shipping costs that helped boost profitability.
BofA Merrill Lynch said Amazon's growth metrics may have disappointed, but investor sentiment would be supported by a shift to a third-party model, ongoing gross margin upside and solid U.S. margins.
BofA Merrill nudged its target on Amazon shares to $315 from $300, while Nomura Equity Research raised its price target to $325 from $285.