Amazon Adds Private-Label Grocery To Its Repertoire

KeyBanc noted Tuesday that Amazon.com, Inc. AMZN recently registered Bloom trademark, which signals a meaningful push into both private-label grocery and High Performance Computing.

Analyst Brett Andress believes the development represents several long-term positives for Amazon. The analyst noted that private label is an important part of the company's focus on apparel and food. The analyst is of the view that private label will increase customer royalty, helping Amazon to fill important gaps in product assortment.

Margin Boost

The firm believes the company may see 400 to 1,000 basis points higher margins on higher adoption of private label. Over time, the firm believes Amazon will be able to leverage its data advantage to better craft very targeted private-label offerings for customers.

The firm has an Overweight rating and a $847 price target on shares.

At last check, Amazon shares were down 0.94 percent at $833.78.