Amazon.com Inc. shares rose 2% in Tuesday premarket trading after the e-commerce giant was upgraded to outperform from market perform at Bernstein. Analysts maintained their $3,400 price target.
Bernstein forecasts that Amazon (AMZN) will still be the go-to choice for shoppers, even after the pandemic.
"[W]e undervalued the power of being the sole e-commerce demand aggregator," Bernstein wrote in a note.
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"Amazon is positioned to increase their dominant share position when the return to physical stores occurs. Amazon has also quietly made substantial inroads into grocery and 'shopping' verticals."
Analysts led by Mark Shmulik also have first-hand experience with the benefits of one-day delivery, an offering that they first thought would not be much of a competitive advantage. Analysts say they ended up purchasing a TV and having it installed through services they found on Amazon that were cheaper and quicker than BestBuy.com (BBY) .
"Amid COVID, Amazon has executed incredibly well, pivoting its operations and inventory to in-demand verticals -- with flexibility and speed we didn't expect," analysts said.
And the company can make further gains in other "revenue pools" like advertising and cloud services.
Amazon stock has rallied more than 60% for the year to date. The Amplify Online Retail ETF (IBUY) has gained 67.8%. And the S&P 500 index is up 1.6% for the period.
-Tonya Garcia; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
September 22, 2020 07:58 ET (11:58 GMT)
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