Amazon (NASDAQ:AMZN) may be up 7.5% in 2026, but the broader tech market has left it well behind, with the Nasdaq climbing about 22%. The gap certainly cannot be blamed on weak operating results, considering Amazon continues posting robust growth throughout several important divisions.

The latest quarter makes that disconnect particularly clear. Second-quarter revenue increased 20% year-over-year, while AWS sales climbed 37% to $42.2 billion, marking their fastest growth rate in 18 quarters. Operating income also rose 43% to $27.5 billion during that period.

Much of the market's hesitation relates to the immense price tag attached to Amazon's AI expansion. The company raised expected 2026 cash capital spending to about $220 billion from an earlier estimate near $200 billion, pouring money into data centers, custom chips, servers, and related infrastructure. Trailing-12-month free cash flow consequently turned negative at $7.6 billion, despite operating cash flow reaching $161.4 billion.

The tech giant expects today's AWS investments to generate revenue as new data centers come online, with customer demand already extending well into the future. Amazon says it still expects capacity to fall short of demand in 2027, while demand already visible for 2028 remains substantial. Investors, however, must wait for those expenditures to translate into stronger cash generation, while Amazon keeps spending heavily to expand capacity.

That brings us to investor Oliver Rodzianko, who ranks among the top 1% of stock experts on TipRanks. He remains enthusiastic about Amazon's longer-term prospects, but thinks investors may want to hold their horses before committing more money at current levels.

"Amazon remains one of the best businesses in the world, in my mind, but that does not make this the most shrewd entry point," Rodzianko noted.

Rodzianko's hesitation becomes clearer when considering how much capital he would commit at current levels. Rather than building an entire position immediately, the investor sees greater value in keeping some money available should a cheaper opportunity arrive later.

"A starter position at this valuation is not reckless, but a full position would be a little bit rushed," Rodzianko explained.

Interestingly, Rodzianko's caution does not extend to Amazon's costly AI strategy, which he views favorably despite its near-term impact on free cash flow.

"Amazon investors should be happy that AI capex has been the company's priority, and I feel confident that cash conversion will emerge strongly in due course," Rodzianko said.

Still, valuation remains the element keeping him from becoming more aggressive at present prices. Amazon trades above the broader market on forward earnings, leaving its multiple vulnerable should interest rates remain elevated or investors become less willing to pay premium valuations for large tech companies.

Rodzianko would rather wait for a wider margin between Amazon's market price and what he considers attractive long-term value. "I like to buy at a discount, and a discount on AMZN significantly deeper than current would be a steal to me," he said.

Rodzianko also offers a specific level where that patience could eventually pay off: "I think a better entry point is on the horizon, potentially under $200 per share in 12-24 months." To this end, the investor assigns AMZN shares a Hold (i.e., Neutral) rating. (To watch Oliver Rodzianko's track record, click here)

Wall Street appears much more willing to buy Amazon at current levels, with 39 Buy ratings and only 2 Holds, giving AMZN a Strong Buy consensus. The average 12-month price target stands at $331.16, pointing to about 33% upside from current levels. (See AMZN stock forecast)