Amazon is primed to continue evolving

It's operational efficiency, network effect and brand strength built on exemplary customer service provide a competitive foundation for continued innovation success

Andrew Willis 15 July, 2019 | 2:03AM
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Andrew Willis: To celebrate Amazon Prime Day(s) happening today and tomorrow, we’re shining the spotlight on Amazon and its continued domination of the retail segment – and soon, perhaps, other sectors.

Amazon's disruption of the retail industry is well documented, but the company continues to find ways to evolve its business model.

Few traditional retailers can match the combination of competitive pricing, unparalleled logistics capabilities and speed, as well as the high-level customer service that makes Amazon an increasingly vital distribution channel for consumer brands.

Even with other retailers looking to expand online, we believe Amazon will continue to dominate through its Prime expedited shipping offering, an expanding digital content library, and new partnerships from its Whole Foods acquisition.

We rate Amazon four-stars, assess its shareholder stewardship as exceptional, and believe the stock is still undervalued by approximately 15%.  

With more than 440 million estimated global active users, more than 120 million global Prime members, and fulfillment infrastructure, technology, and content investments, Amazon owns one of the wider economic moats in the consumer sector and is likely to reshape retail, digital media, enterprise software, and other categories for years to come.

For Morningstar, I'm Andrew Willis.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Amazon.com Inc182.55 USD-0.32Rating

About Author

Andrew Willis

Andrew Willis  is Senior Editor at Morningstar Canada. He previously produced content for Fidelity Investments and finance industry events for Euromoney Institutional Investor and has written in the past for Thomson Reuters and CNN. Follow him on Twitter @Andrew_M_Willis.

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