![](https://cdn.benzinga.com/files/imagecache/2048x1536xUP/images/story/2012/abtech_3975.png)
- BNP Paribas Exane gave an Underperform rating to Amazon.com Inc (NASDAQ:AMZN), citing a bumpy ride ahead due to surging inflation and higher expenses.
- Analyst Stefan Slowinski said investments during the pandemic to build fulfillment centers for faster deliveries and employee bonuses to keep its warehouses staffed in a tight U.S. labor market may eat into its margins.
- He added that capital expenditure could grow in the mid-teens, initiating a price target of $2,800, implying a downside of 15.8%.
- While margin expansion is possible, the consumer is under pressure with high inflation. Amazon has already raised prices on their customers by increasing their Prime pricing.
- Amazon would not raise pricing on many products to match inflation and probably take a hit.
- Amazon would need to allocate capital expenditure for its cloud business as it looked to expand its footprint by about 30% in a competitive market.
- Price Action: AMZN shares traded lower by 1.46% at $3,336.97 on the last check Wednesday.