is gearing up for a huge holiday season—one that effectively kicks off in October.
The e-commerce giant (ticker: AMZN) pushed its Prime Day sales event to Oct. 13 and 14, from its usual July window amid the pandemic. That’s a bit more than a month away from the Thanksgiving weekend and Cyber Monday sales extravaganza.
said in July of last year that Prime Day 2019 was the largest shopping event in its history, at that point, and surpassed its prior record for Black Friday and Cyber Monday combined. Of course, the company didn’t provide many hard data points for investors to compare.
Investors will likely expect similar milestones, given Amazon has tended to top its sales seasons year after year. The company said in December that Cyber Monday 2020 was the biggest shopping day in its history, in terms of items purchased.
Baird analyst Colin Sebastian wrote in a note Monday that demand indicators for the upcoming holiday season appear strong for e-commerce. The Covid-19 pandemic should likely push shoppers away from the usual Black Friday crowds. Amazon stock has soared 70% in 2020, amid such shifts to e-commerce.
“With this comes unprecedented strain on supply, fulfillment and delivery capacity, although we note that Amazon may have an edge over some competitors with Amazon Logistics now delivering more than half of customer orders,” he wrote.
This year, Black Friday comes amid concerns about cuts at the United States Postal Service. But he notes that the October Prime Day event will reportedly be followed “Early Black Friday Deals.” Such deals would include shoppers that don’t have Prime and run in the weeks leading up to Thanksgiving—pulling holiday season demand forward a bit and stretching out the logistical strain as December approaches.
Sebastian wrote that Amazon stock still looks attractive at current levels. The company is set to report third quarter results next month, and Sebastian believes the company could beat consensus revenue expectations that call for sales of $92.5 billion, according to FactSet. He pointed the checks that imply another strong quarter for Amazon Retail and improving Amazon Web Services trends.
Amazon stock was up 1.7% to $3,148.99 Monday morning, while the S&P 500 index was up 1.3%. Sebastian’s $3,500 price target implies about 11% upside.
Write to Connor Smith at [email protected]