Is there anything that is going to stop this company?
We see Amazon post a terrific holiday season, with strong sales from Thanksgiving through Christmas. This is no surprise as the amount of online sales for the season crossed 14%. With this type of growth, Amazon was surely to benefit.
One of the things that helped the company's numbers is the hit for one day delivery was less than the $1.5 billion they expected. The service was a major success with Amazon customers, the only question was what the tally would be.
Since they were able to save a couple hundred million dollars, it makes the offering even that much more attractive to the company.
The stock surpassed $2,000 upon the open this morning as the company is approaching a $1 trillion market cap. In afternoon trading, the value places it at $920 billion.
Amazon AMZN, headed to a $1 trillion valuation after reporting earnings of $6.47 per share late Thursday, blowing past the $4.04 FactSet consensus, and reaching record quarterly sales of $87.4 billion.
By having the ability to deliver one day service at a cost lowered than expected reminds everyone of the innate ability of this company to leverage its size.
Friday, analysts were quick to raise their price targets. One of the reason is the number of Prime subscribers jumped in the 4th quarter.
Prime membership has topped 150 million around the globe, an update that was also a welcome surprise. Amazon said more people joined in Q4 than any previous quarter.
The news was announced “because Prime members spend more than twice what non-Prime members do, making them critically important to the bottom line,” said Jack O’Leary, senior analyst at data and analytics company Edge by Ascential.
Amazon is certainly going to cross the $1 trillion marketcap threshold soon. It cannot be denied how powerful this company truly is.
Not only is the retail segment very strong, AWS is, perhaps, even more powerful. It is the leading cloud platform and is only increasing its lead as they add a variety of AI options for customers to use.
Amazon is a darling of Wall Street after being despised for so long. Traditional metric, for the first decade they were in business, were pretty abysmal. Bezos operated from a long term plan knowing that his willingness to forego profits to gain market share would eventually pay off. This is exactly what happened.
While all other retailers are scrambling, Amazon is now leveraging its ability to automate to further distance itself from the competition. The simple fact is this company can deliver a product cheaper than everyone else. This helps their margins substantially.
If we see the annual percentage of online sales jump into the 14%-15% range, then we can expect Amazon to have a magnificent year. As of November 2019, that numbers, overall, was just over 11%.
Not that the company needs it but Amazon could be getting another shot in the arm.
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Posted via Steemleo
