Amazon.com Inc (NASDAQ:AMZN) has launched Amazon Now, which is an ultrafast delivery option of 30 minutes or less, to test in sections of Seattle and Philadelphia, according to BofA Securities.
The Amazon.com Analyst: Analyst Justin Post maintained a Buy rating and price target of $303.
The Amazon.com Thesis: With Amazon Now, customers in select parts of Seattle and Philadelphia will receive groceries and everyday essentials in 30 minutes or less, Post said in the note.
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Amazon Now should complement the company's same-day grocery capabilities with very small basket convenience items, he added.
"As a result, we believe Amazon can continue driving important customer frequency benefits and a lock-in effect not possible with other verticals," the analyst wrote.
Although Amazon Now is in early phases of testing, it could mark an important step in Amazon.com attracting purchases that would have otherwise been made in-store, due to immediacy needs, he further stated.
AMZN Price Action: Amazon shares were up 0.41% at $234.83 at the time of publication on Tuesday, according to Benzinga Pro data.
Amazon, with a market cap of $2.51 trillion, operates in the consumer discretionary sector, where its P/E ratio of 33.03 reflects strong growth expectations compared to traditional retail peers.
Historically, the stock has shown resilience, currently trading near the higher end of its 52-week range of $161.38 to $258.60, indicating investor confidence amid evolving market dynamics in e-commerce and cloud services.
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