Jefferies: Industry Leading fufillment services may lead to revenue growth for Amazon.com

On Tuesday Jefferies issued an technology industry update highlighting among others Amazon.com, Inc.AMZN and their business strategy. Currently Jefferies rates Amazon.com as a Buy and raised their price target to $465.

Brian Pitz and Brian Fitzgerald, analysts at Jefferies, wrote, “Today we take a fresh look at AMZN's evolving fulfillment capabilities which emerge as part of a bigger, multi-faceted strategy focused on better customer segmentation and category leadership. We expect this strategy to bring rev growth acceleration in the medium to longer-term and margin improvement with scale.”

Jefferies believes that Amazon.com’s fulfillment initiatives are part of a larger strategy focused on customer segmentation and category leadership. Amazon.com’s approach includes offering the widest range of fulfillment options at the lowest prices while allowing for increasing scale efficiencies. As demand continues to grow for Amazon.com, analysts believe that revenue growth will continue to accelerate, increasing Amazon.com’s leverage and allowing the company to continue to improve their fulfillment service platform.

As evidence of Amazon.com continuing to grow in size in a recent article Jason Derrick of Benzinga wrote about Amazon’s growth opportunity in India.

“According to Mahaney's analysis of the Indian Online Retail sector, the country has become a "significant" market focus for Amazon, given the company's recent $2 billion investment in the country. The analyst added that Amazon's "relatively sizeable" presence makes it well positioned as the market has the potential to reach $18 billion by 2018.”

“Mahaney also noted that Amazon is "reasonably well positioned" in India from a competitive point of view and should be able to generate "material contributions" within five to 10 years.”

Shares of Amazon.com, Inc. have recently traded at $382.36.