Why Amazon Stock Popped on Monday

Shares of internet retail giant Amazon (AMZN 1.99 percent) rose 2.4 percent through 3 p.m. ET on their first trading day after the stock split. That is most likely due to Wall Street.

With Amazon's unusual move to split its stock 20 for 1 in March, and the split finally taking effect today

all eyes were on Wall Street to see how they would react to the new share price, as well as what new price goals analysts would attach to the company at its new price.

According to Street Insider, MKM Partners was the first analyst to issue a post-split report (with a target price) on Amazon

MKM is remaining very close to its pre-split target price of $3,625 per share (now divided by 2).

To be precise, MKM now values Amazon shares at $180 per share, just a smidgeon below where it previously valued the stock

Separately, according to The Fly, investment banker Stifel issued a fresh $190 price objective on Amazon shares, thereby maintaining the banker's pre-split estimate of $3,800.

MKM and Stifel (as well as myself) agree that the stock split is virtually a non-event that has no impact on the company's worth.

The bad news is that, because stock splits don't change anything other than the number of shares a company is divided into, Amazon stock still costs 52 times earnings post-split, just as it did pre-split

the stock is only expected to grow those earnings at a rate of about 27 percent annually over the next five years.

This results in a PEG ratio of roughly 2 for Amazon shares (or twice what value investors ordinarily consider a "fair price").