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Will Prime Day 'Fail' Shake Confidence in Amazon.com, Inc. (AMZN)?

Amazon.com, Inc.'s (AMZN) Prime Day has been marred by technical glitches and angry customers

Jul 12, 2016 at 12:10 PM
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It's been a #PrimeDayFail for Amazon.com, Inc. (NASDAQ:AMZN). Specifically, Twitter Inc (NYSE:TWTR) users are bashing the online retailer's epic sale, complaining that they're unable to add special deals to their virtual shopping carts -- though, AMZN recently said it has resolved the issues. Adding insult to injury, J.P. Morgan Securities cut its price target to $908 from $915.

Collectively, these developments have AMZN stock 0.4% lower at $750.88. It was a much different story earlier in the day -- prior to the Prime Day complaints -- when the shares raced to a record high of $757.34. Given AMZN's longer-term technical tenacity, it's not surprising that it faces few detractors on Wall Street.

While the stock was hit with a price-target cut today, the prevailing mood among analysts has been overwhelmingly enthusiastic. Thirty brokerage firms track AMZN, 28 of which recommend buying the shares, compared to a pair of "holds" and not a single "sell." Meanwhile, short interest is nearing all-time-low levels -- based on data since 2002 -- with just 5.1 million shares sold short.

In a similarly upbeat vein, Amazon.com, Inc. (NASDAQ:AMZN) calls have been the options of choice among traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). During the past two weeks, speculators have bought to open 1.09 calls for every put. Much of that attention has been centered on the out-of-the-money July 770 call -- which has seen a huge increase in open interest during the same time span -- as traders bet on even higher highs for AMZN by this Friday's close.

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