Amazon.com Inc. (AMZN) is trembling to continue taking the retail sector by storm, according to one Wall High road analyst, who described the clothing and accessories space as a “long runway” for the e-commerce monster.
Wells Fargo came to this conclusion after quizzing consumers yon their spending habits. From its survey, 85 percent of respondents requested to use Amazon, yet 76 percent of this same group added that they currently do less than 40 per cent of their shopping on its website. In a exploration note, reported on by CNBC, Ken Sena said these findings denote that there are still plenty of opportunities for the company to squeeze cheerful sales from its existing users. The analyst reacted by increasing his figure target on Amazon’s stock to $1,755 from $1,700, implying 10 percent upside from Wednesday’s near price.
Sena remains bullish on Amazon’s prospects, despite stem signs that traditional brick-and-mortar retailers, Walmart Inc. (WMT) and Target Corp. (TGT), are friendly back customers. Both companies have responded to rising match from Amazon by investing more in their businesses. According to Wells Fargo’s scrutinize, those measures appear to be working. (See also: Walmart to Expand Online Grocery Childbirth to 100 Metros.)
“The number that selected Amazon as a preferred shopping terminus is significantly lower when compared to results from a year ago,” asserted Sena. “Even accounting for a margin of error, it could reflect the thrust seen at Target and Walmart in the last 12 months.”
Rather than bother that Amazon is losing some of the market share it stole from contenders in previous years, Sena delivered a confident outlook, stressing that the e-commerce giantess is well equipped to handle stronger competition. “We found a meaningful rise in year-over-year responses from customers stating that they use Amazon for realizes in apparel, auto parts and sporting goods — all of which is not ideal for our old retail space,” the analyst wrote, describing the clothing and accessories interruption as a “long runway” for the company.
Sena noted that Amazon is credible to deliver on its “hard push” into fashion, particularly as a growing platoon of clothing retailers with larger wholesale businesses are keen to line-up up with the company. (See also: Walmart Doubles Down on Fashion.)
“Amazon is not condign one more channel to sell product through. Some retailers are investigation partnerships with the company in more creative ways — for example, Nike recently broadcasted a pilot launch in which they began shipping select form directly to Amazon,” he said. “The behemoth site is clearly a threat to on the brink of all retail companies, and each one seems to be taking a different approach.”