Amazon continues to grab e-commerce market share per BofA data
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Bank of America said Amazon's (NASDAQ:AMZN) e-commerce growth rates has picked up in Q3.
The firm estimated that in the U.S. Amazon's (AMZN) growth accelerated to 17% in Q3 from 5% in Q2 to outpace the gains seen by online Target (TGT) and Walmart (WMT), as well as the overall online retail industry average. The estimates are based on credit card and debit card data.
The Prime Day event during the quarter was the biggest factor in the impressive growth estimate, although improved product selection and delivery times for AMZN were also a growth tailwind.
BofA analyst Justin Post said a key question is that with Amazon's (AMZN) inventory up 58% Y/Y in Q2, and competitors seeing pressure on gross margins, if the no-store/3P model has insulated the e-commerce giant from inventory write-down risk.
Looking forward, Post and team expect a couple points of market share gain through 2024 for Amazon (AMZN) as it continues to benefit from the massive fulfilment investment in 2020-2022. Maintain Buy on Amazon.
BofA has a Buy rating on Amazon (AMZN) and price objective of $170. The PO implies a trading multiple of 2.9X the 2023 price/sales mark, which is near the high end of Amazon's historical range of 1.0X to 3.5X.
See all the valuation metrics on AMZN.