After Amazon (AMZN) stock pulled back sharply in recent months, the shares “are starting to look appealing,” and they are providing investors with a good “buying opportunity”, Megan Brantley, VP of Research at LikeFolio recently told Schwab Network.
Brantley specializes in consumer research.
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AMZN’s Spring Sale Was Positive for the Company, Brantley Says
Amazon’s Spring Sale, which ended on March 31, attracted “a pretty significant amount of interest” from consumers, Brantley reported. Since Amazon’s e-commerce unit was “struggling..to gain traction” before this event, it was important for AMZN to combat the latter trend, she stated. The Spring Sale did fulfill the latter goal and should boost the company’s first-quarter results, Brantley reported.
AMZN Is Resilient, But Has Lost Some Momentum
The tech giant’s e-commerce unit is “resilient, “partly due to its Prime program, which tends to make many consumers keep purchasing products from Amazon, the analyst stated. On the other hand, its e-commerce unit has “lost a little bit of momentum” as middle-class and lower-class Americans struggle to buy as many products as they did previously, Brantley stated.
But Amazon’s e-commerce unit still has a multitude of strengths, including its ability to deliver products in the same day that they are ordered to many metropolitan areas in the U.S. “Many consumers value the company’s speed and convenience,” she stated.
Further, the company has made its search engine more effective for consumers, and it has been less affected by politics than Target (TGT), she said.
“Amazon has a high sentiment rating, its execution has improved, and it’s a best-of-breed name,” the analyst reported.
While we acknowledge the potential of AMZN, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: The author owns shares of AMZN but has no intention of trading them in the next 48 hours. This article is originally published at Insider Monkey.
