Market Overview

How Much Are Prime, Prime Video Worth For Amazon?

Share:
How Much Are Prime, Prime Video Worth For Amazon?

Amazon.com, Inc.'s (NASDAQ: AMZN) Prime subscription service, which was conceptualized with the idea of retaining customer royalty, is slowing and steadily becoming a vital cog in the e-commerce giant's wheels, according to Needham. 

The Amazon Analyst: Laura Martin has a Buy rating on Amazon with a $3,700 price target. 

The Amazon Takeaways: Data from multiple independent data providers confirm accelerating consumer adoption of stream services, Martin said in a Monday note. (See her track record here.)

Amazon had 150 million Prime members as of January 2020 who are paying $119 per year, a 50% year-over-year increase the analyst said, citing company data.

Martin said she expects subscriber additions to accelerate further due to the COVID-19 pandemic. 

About 80% of subscribers pay for Prime primarily for free shipping, and the remaining 20% for media assets such as Prime Video, Twitch, music and reading, the analyst said, citing a Diffusion group survey.

Prime is priced comparably with Netflix Inc's (NASDAQ: NFLX) at $9-$10 per month, she said.

Amazon loses less money than Netflix on its video subscriptions, Martin said. 

Amazon Prime is worth about $200 billion, or 12% of the company's total enterprise value, and Prime Video about $40 billion, or 2% of the enterprise value, according to Needham estimates. 

Amazon has several hidden multipliers to suggest it is worth between $4,500 and $5,000 per share, Martin said. 

AMZN Price Action: Amazon shares were higher by 1.09% at $3,182.41 at the close Monday. 

Related Links:

Apple Prepping Subscription Bundles To Boost Recurring Revenue: Report

RBC Lifts Amazon Price Target To Street-High $3,300, Says It's 'Best Global Play' On E-Commerce

Photo courtesy of Amazon. 

Latest Ratings for AMZN

DateFirmActionFromTo
Nov 2020China RenaissanceUpgradesHoldBuy
Nov 2020CitigroupMaintainsBuy
Oct 2020BenchmarkMaintainsBuy

View More Analyst Ratings for AMZN
View the Latest Analyst Ratings

 

Related Articles (AMZN)

View Comments and Join the Discussion!

Posted-In: Amazon Prime e-commerce Laura Martin NeedhamAnalyst Color Price Target Reiteration Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
PLTHCanaccord GenuityMaintains6.0
VLDRCraig-HallumInitiates Coverage On23.0
MFACNorthland Capital MarketsInitiates Coverage On15.0
CEREJefferiesInitiates Coverage On18.0
GIIIUBSInitiates Coverage On22.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com