Barclays analyst Douglas Anmuth makes a mildly contrarian call. Deeming Amazon.com (AMZN) a long-term recession winner, even though it’ll go through a rough Q4, he jacks his price target from $46 to $54.
We believe AMZN’s business model is structurally sound & the company’s competitive position is actually strengthening during the current downturn as certain retailers close stores & have challenges obtaining inventory. We expect Amazon to continue to gain share of both overall retail & e-commerce, & we expect the company to return to DD growth when macro stabilizes.
We lowered numbers significantly on 11/18 and we are 19% and 15% below consensus EPS for 4Q08 and 2009 based on revenue and margin concerns. But our call is long-term based on need to focus on quality companies that can come out of downturn stronger.
We’re on board with Amazon-the-survivor thesis, and we believe in the company long-term. But if Doug is right and consensus EPS is way too high, this stock is going nowhere until the rest of the Street cuts estimates.
Among the top 500 Retail Web sites Web metrics firm HitWise monitors, Amazon.com saw the most traffic on Cyber Monday — an increase over its own 2007 traffic by 21%.