Shares in Amazon (AMZN) stock closed Tuesday at $232.14, up 4% in the last five trading sessions. Meanwhile, its Magnificent-7 stock rival Alphabet (GOOGL) is up a modest 2% in that same period, closing Tuesday at $314. While GOOGL took the magnificent-7 crown in 2025, the grouping has been a lot tighter together in the latter months of the year, thanks to the AI race. All of the grouping have heavily invested in AI this year, resulting in huge gains to investor interest. While Amazon stock has been a consistent buy this year, it enters 2026 sitting slightly behind Alphabet (GOOGL). Fortunately, that trend has a solid chance of changing next year.
YTD, AMZN is only up 5%, but that’s largely due to the poor Spring season that sent most US stocks plummeting. With its AI prospects booming and AWS cloud computing looking promising, Amazon has plenty of potential in 2026. As a result, there are varying bullish stock forecasts for AMZN. Indeed, current price targets range from $244 to $340, indicating potential upside from the current market price of $232.
Truist Securities analyst Youssef Squali forecasts Amazon’s growth at 10.5% in 2026, down from 12.1% in 2025, fueled by strong growth factors and AI-driven services. Amazon’s proposed deal with OpenAI could prove a worthy catalyst to send AMZN shares higher next year. Indeed, the e-commerce giant is in talks with Sam Altman’s OpenAI, which hosts the world’s top AI platform ChatGPT, for a potential investment of $10 billion. The talks also indicate that OpenAI could use Amazon’s in-house Trainium chips as part of the offer. If the deal goes through, it would be a significant breakthrough for Amazon’s relatively young semiconductor business.
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On the flip side, plenty of eyes have been on Alphabet (GOOGL) recently, thanks to its in-house tensor processing units (TPU). Several experts predict that Alphabet’s TPUs could become a major revenue driver that sends GOOGL stock higher. These application-specific chips have long been the backbone of Google Cloud, and investors are warming to the idea that selling them externally could be a lucrative extension of that strategy. Analysts point to recent momentum triggers, including Alphabet’s commitment to supply tens of billions of dollars of TPUs to Anthropic and reports that Meta may be in talks to spend billions.
Much of Amazon’s lackluster recent performance can be tied to the growth of AWS, which trails that of Microsoft Azure and Google Cloud. However, Amazon saw AWS revenue growth accelerate to 20% last quarter, and the company said it was capacity-constrained. As such, it’s boosting its capital expenditure (capex) budget to try to meet growing demand. This could mean a solid start to the year that will set the pace for AMZN to catch up to GOOGL in the AI race.
