Morgan Stanley Sees Longer Ramp to Margin Expansion for Amazon.com
Morgan Stanley has published a research report on Amazon.com (NASDAQ: AMZN) as the company's margin expansion appears to be experiencing delays due to the variable cost structure.
In the report, Morgan Stanley writes, "With the continued unit mix-shift to Amazon.com's higher margin 3P platform, the market anticipates that 2012 will mark the beginning of a material margin expansion cycle. Our analysis indicates that margins may remain challenged in 2012 and that expansion will require substantial unit growth in the high-margin business segments in order to drive operating margin expansion."
Morgan Stanley maintains its Equal-weight rating on Amazon.com, which is currently trading down $5.19 from yesterday's $199.66 closing price.
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