- Amazon has repeatedly shown an uncanny ability to disrupt entire segments of the stock market with corporate announcements.
- The most recent example came as Amazon announced it will buy pharmacy startup PillPack, which sent shares lower all across the supply chain.
- Prior to that, Amazon said it was considering offering home insurance, sending shares of Allstate, Chubb, Hartford Financial, Travellers, and Progressive tumbling.
- It’s a dynamic that’s played out repeatedly over the past year.
Amazon‘s acquisition of pharmacy startup PillPack may have rocked other companies in the industry, such as Walgreens Boots Alliance, CVS, and Rite Aid, but it’s far from the first time Jeff Bezos & Co. have imposed their will on the market.
The company has made a habit out of crushing competitor market values with even the most basic of announcements, and their delivery initiative is just the latest example of that.
The reasoning is simple – Amazon has a ton of cash and an unparalleled logistical network, and when it looks poised to enter or expand its position in a market, traders get scared and bail out of existing holdings in other companies.
Amazon has done this so regularly, in fact, that it can be difficult to keep all the instances straight. That’s where we come in.
Below you’ll find a list summarizing recent examples of companies getting “Amazon’d” – the Business Insider-coined term for when a stock finds itself at the whim of the ever-expanding juggernaut.
June 2018 — Stocks all across the pharmacy supply chain tumble after Amazon says it will buy online pharmacy PillPack
Shares of CVS, Rite Aid, and Walgreens Boots Alliance traded sharply lower immediately after Amazon’s announced acquisition of PillPack. The pain was also felt elsewhere in the pharmacy supply chain, with drug wholesalers Cardinal Health, AmerisourceBergen, McKesson, and Express Scripts seeing deep losses.
The deal is also a blow to Walmart, which was reportedly looking at buying PillPack in early April.
June 2018 — Home insurance stocks decline following reports that Amazon is considering offering the service
Shares of Allstate, Chubb, Hartford Financial, Travellers, and Progressive traded sharply lower immediately after the Amazon report hit newswires. While these stocks pared losses shortly after the initial story, the immediate negative effect was undeniable.
What’s unique about this situation is that Amazon itself hasn’t made this announcement. Rather, competing home-insurance stocks are falling on unconfirmed reports alone, showing that the mere prospect of getting Amazon’d is enough to wipe out market value.
February 2018 — Package-delivery stocks tumble after Amazon says it will launch its own competing service
Shares of UPS and FedEx traded sharply lower in the pre-market the day of this report. With Amazon planning to undercut the costs of the other delivery giants, investors in the companies started anticipating the negative effect of lower package volume.
January 2018 — Healthcare stocks tumble after Amazon, JPMorgan, and Berkshire Hathaway announce collaboration to reduce costs for US workers
While the three companies weren’t specific about what kind of enterprise they aim to create, noting only that they wanted to improve employee satisfaction while reducing costs, the announcement reverberated through the stock market.
Managed care and pharmacy providers absorbed the brunt of the selling, with companies including MetLife, Express Scripts, and UnitedHealth seeing large share drops that accounted for billions of dollars in lost value.
June 2017 — Grocery stocks slide after Amazon announces $US13.7 billion acquisition of Whole Foods … and then again two months later after price cuts are announced
Amazon hit grocery stocks with a double-whammy of weakness in this particular instance, causing an initial drop after announcing its mega-acquisition of Whole Foods, then reigniting selling two months later after cutting prices.
June 2017 — Athletic apparel retailers slide after report that Amazon was going to partner with Nike
In June 2017, Goldman Sachs published a report speculating that Nike was “close” to commencing a direct relationship selling product on Amazon.com. That caused selling in both athletic apparel manufacturers, as well as retail chains.
June 2017 — Pharmaceutical supply chain stocks decline after Amazon’s purchase of Whole Foods spurred speculation it could eventually get into healthcare
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