Amazon shares seen range-bound as options trade targets late-September window

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Amazon shares range-bound outlook

Highlights

Options trader Mike Khouw recommends a 'jade lizard' strategy targeting Amazon remaining between $240 and $300 through the Sep. 25 expiration, with limited upside hedge at $320.
Amazon shares have traded sideways since jumping 15% post-earnings on July 30, as analysts cite a lack of catalysts before the next quarterly report.
Amazon's estimated fiscal 2027 capital expenditure and EBITDA both surpass $280 billion, supporting $828 billion fiscal 2026 revenue and a 22x 2027 EPS multiple near market average.

Options strategy focuses on near-term trading range

As reported by CNBC, options trader Mike Khouw is recommending a "jade lizard" strategy for investors who expect Amazon shares to stay range-bound through late September. The trade combines a short put, a short call and a higher-strike long call, aiming to profit if the stock neither breaks to new all-time highs nor falls materially below its pre-earnings level.

The proposed position involves selling the Sep. 25 $240 put, selling the Sep. 25 $300 call and buying the Sep. 25 $320 call. In this setup, the higher-strike long call acts as a hedge, while the overall trade reflects a view that Amazon is unlikely to produce a sharp move before its next quarterly results.

Amazon shares have been moving sideways since the stock jumped 15% after earnings on July 30. The market commentary suggests that a lack of expected catalysts between now and the next earnings report is reinforcing that technical pattern.

Growth outlook and spending remain central for investors

Amazon continues to post strong top-line expansion, with fiscal 2026 revenue estimated at more than $828 billion, equivalent to more than 2.5% of U.S. GDP and 15.5% year-over-year growth. Even so, the shares trade at about 22 times fiscal 2027 adjusted earnings per share estimates of $12.35, a valuation described as close to the broader market multiple.

Investor caution appears tied in part to the scale of planned capital spending by major cloud and AI infrastructure operators. Amazon's fiscal 2027 capital expenditure is estimated at nearly $280 billion, though projected EBITDA for the same period is also above $280 billion, indicating the company retains financial capacity to support that investment program.

Amazon now ranks first on the Fortune 500, displacing Walmart after its long run at the top. In the 72-year history of the list, only General Motors, ExxonMobil, Walmart and now Amazon have held the number one position, underscoring the company's scale as investors assess whether its spending will translate into future returns.

Our earlier coverage of the AI infrastructure spending surge explained that investment in data centers, power, and related buildout is rising rapidly even as business adoption of AI remains relatively limited. We noted that this mismatch can push up near-term costs and add to inflation uncertainty, while the broader payoff to growth and productivity may take longer to show up—an important backdrop as investors weigh big tech capex plans.

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