Stifel maintained its Buy rating on Amazon.com (NASDAQ: AMZN) shares, setting a price target of $224.00. This decision comes amid ongoing developments related to Amazon’s partnerships with Whole Foods Canada and Instacart (NASDAQ: CART). Stifel’s assessment indicates that Amazon’s recently announced service, which comes with additional charges for Prime members, may not offer substantial savings compared to Instacart. However, it provides the convenience of a single platform for both retail and grocery purchases. Stifel’s analysis suggests that while some investors anticipated that the Whole Foods Canada deal with Instacart could lead to broader utilization of Instacart’s services by Amazon, recent announcements indicate that such a partnership is unlikely to materialize in the near future. Despite the service carrying an extra cost for Prime members, with price and basket size thresholds mirroring those of Instacart, it does not offer significant savings. Stifel also anticipates that this move will not lead to a substantial shift of Instacart’s existing customer base to Amazon, as the cost dynamics between the two services are comparable. However, the firm believes that Amazon’s entry into this space could hinder Instacart’s growth with new customers. Stifel’s commentary acknowledges that they had anticipated announcements like this and that their projections have already factored in a certain degree of market share loss for Instacart in the coming years. Amazon’s stock remains under close scrutiny by investors, with Stifel’s reiterated Buy rating and stock price target of $224.00 reflecting confidence in the company’s strategy and market position, despite competitive dynamics with services like Instacart.
Stifel’s Latest on Amazon: Buy Rating Remains, While Competition with Instacart Intensifies
