77.25 -0.29 (-0.37%)
After hours: 5:41PM EDT
|Bid||76.51 x 2200|
|Ask||78.00 x 1100|
|Day's Range||77.40 - 78.44|
|52 Week Range||60.15 - 90.39|
|Beta (3Y Monthly)||1.03|
|PE Ratio (TTM)||14.06|
|Earnings Date||May 22, 2019|
|Forward Dividend & Yield||2.56 (3.29%)|
|1y Target Est||85.73|
What Analysts’ Recent Activity Indicates about Costco Stock(Continued from Prior Part)Solid performance Shares of Costco (COST) are up 16.4% YTD (year-to-date) as of March 19. The strong uptrend in Costco stock is supported by the company’s
E-commerce data analytics firm Marketplace Pulse recently conducted in-depth research on private label brands on Amazon (NASDAQ:AMZN). The conclusion seemed unfavorable for Amazon stock. According to the firm, Amazon's private-label brand portfolio actually has more duds than studs.Source: Shutterstock The research suggests that Amazon's private-label business isn't growing. That could be the reason why Amazon's e-commerce growth machine has cooled rapidly. Indeed, over the past several quarters, Amazon's e-commerce business has gone from a 20%-plus grower which dominated the digital retail world to growing just above 10% and ceding market share to other digital retailers. * 5 Cloud Stocks to Help Your Portfolio Fly But there's another big takeaway from Marketplace Pulse's report, one that is bullish for Amazon stock. Namely, the report included a quote from an Amazon spokesperson who said that Amazon's private-label products represent less than 1% of the company's total sales.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThat's tiny. At other large retailers, the private-label business represents 30% or more of total sales. Thus, the bullish takeaway from the report is that Amazon's private-label business, with the right execution, could grow by leaps and bounds over the next several years.That would be big for Amazon stock. Most importantly, it would wake up the Amazon e-commerce- growth machine, reinvigorate investors' enthusiasm about Amazon stock, and spur more investors to buy AMZN stock. Furthermore, it would boost the company's margins, add firepower to what is already turning into a robust profit-growth outlook, and help AMZN grow into its valuation.Overall, a private-label surge could turn into a big deal for Amazon stock. Here's a deeper look. Amazon's Private-Label Business Is TinyAmazon is a big company. With over $230 billion of sales last year, Amazon is the second-largest retailer in the world, behind only Walmart (NYSE:WMT).But, for such a big retailer, Amazon's private-label business is really small. Amazon's private-label business represents less than 1% of its total sales. That means that Amazon's private-label business generates less than $2.3 billion of annual revenue.That's small. Over at Costco (NASDAQ:COST), the Kirkland brand alone represents nearly one-third of its total sales, or about $40 billion. Similarly, one-third of Target's (NYSE:TGT) total sales in 2018, or about $25 billion, were from owned and exclusive brands,. At Kroger (NYSE:KR), private-label -brand-unit share hit 30.5% in the fourth-quarter, which, at an annualized rate, represents about a $34 billion business.At many other big retailers, the private -label business runs anywhere from 15%-30%-plus of total sales, equating to $15 billion-$40 billion-plus of annual revenue.Next to those figures, Amazon's sub-1% private label penetration rate and roughly $2 billion private-label business are tiny. Amazon's Private-Label Business Could Be Really Big One DayAmazon's private label business could be really big one day.The math is pretty simple. An average private-label penetration rate of 25% on all of Amazon's 2018 revenue, excluding the sales of its cloud business, implies a private-label business of nearly $52 billion, versus its private-label business of about $2 billion today. That represents a 25-fold increase in private label sales. That's huge. Furthermore, it equates to an additional $50 billion revenue opportunity, for a company that reported $232 billion of sales in 2018. That means that AMZN could grow its top line 20%-plus by expanding its private-label business.Private-label products are made and sold by the company itself, reducing the role of middle men. Thus, private label sales increase margins. That means that, if AMZN increases its private-label business to 20% of its revenue, its bottom line would get a favorable bump of much more than 20%.In other words, this isn't small peanuts. It's a big deal.Now, the big question is: can AMZN do it? Can it turn a relatively small private- label business into a $50 billion-plus behemoth? The short answer is: yes. AMZN has done it before with other businesses, and it will do it again.The company has the data, reach, reputation, and brand equity necessary to sell Amazon-branded products on a large scale. The Marketplace Pulse research report partly corroborates this thesis. Although many of Amazon's private-label brands are duds, the ones with the name "Amazon" attached to them are doing very well, the report stated. That speaks volumes about this company's brand equity and reputation.Meanwhile, AMZN hasn't yet figured out a way to consistently utilize its wealth of consumer preference and shopping data to help it sell private-label products. But it's only a matter of time before the company does so. When it does, the company's private-label business will boom, especially considering that AMZN can put those products in front of millions of shoppers.So it does seem like only a matter of time before Amazon executes on its tremendous opportunity to create a huge private-label business. The Bottom Line on Amazon StockAmazon stock is a long-term winner, mostly because of this company's multiple, large growth levers. One underappreciated big growth lever is Amazon's opportunity in the private-label business. AMZN currently has one of the smallest private label businesses of any major retailer. With the right execution, that relatively small private-label business could become very large and raise the company's top line by 20%-plus and add far more to the bottom line.All in all, investors should stick with Amazon stock for many reasons, including its $50 billion private-label opportunity.As of this writing, Luke Lango was long AMZN, COST, TGT, and KR. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Invincible Stocks Leading The Bull Market Higher * 5 Dow Jones Stocks Coming to Life * 7 of the Best High-Yield Funds for 2019 and Beyond Compare Brokers The post Will Private Labels Wake Up Amazon Stock? appeared first on InvestorPlace.
What Analysts’ Recent Activity Indicates about Costco StockA couple of analysts initiate coverage on Costco On March 20, Nomura Instinet initiated coverage on Costco (COST) stock with a “neutral” rating and a target price of $230. Evercore ISI
Target Corp's flagship coffee bags and pods of the brand Archer Farms will be certified fair trade by 2022, the company and Fair Trade USA told Reuters on Wednesday, a victory for that movement, which seeks to make sure producers are adequately compensated for their labor. Coffee futures are currently trading near 13-year lows, weighed down by a record-large Brazilian crop. Archer Farms, Target's flagship-owned coffee brand, sells about six million pounds of coffee each year.
Kroger (KR) inks deal with Peak Rock to sell the Turkey Hill business as part of its efforts to trim its non-grocery offerings.
A Look at Amazon's Latest Moves to Refresh Its Strategy(Continued from Prior Part)Amazon is vying for an $800 billion opportunity Amazon (AMZN) is planning to set up a new grocery chain distinct from Whole Foods, according to a report from the Wall
"We are pleased with the guest response so far and are continuing to evaluate the concept," a spokesperson said.
Siwa encapsulates many of the things that made YouTube the world’s most-watched video site. The 15-year-old kidfluencer also highlights how YouTube’s success with children has created an ethical and perhaps even legal minefield for its owner, Alphabet Inc.’s Google. In addition to shooting quirky videos, Siwa cuts endorsement deals and sells two branded apparel lines with Target Corp., the second-largest U.S. retailer.
A few retailers are demonstrating that a vast, expensive network of selling space isn't necessarily a liability.
There's new and staggering data that support the fact that retailers should increasingly be scared of Amazon dominating e-commerce.
Ross Stores (ROST) is favored for its off-price model, price management, merchandise initiatives, and cost containment and store expansion plans. But a soft outlook for fiscal 2019 keeps us on the sidelines.
A Look at Amazon's Latest Moves to Refresh Its Strategy(Continued from Prior Part)Kiosks to pave the way for larger storesAmazon (AMZN) will shut down all of its 87 pop-up kiosks across the United States by the end of April. The pop-up kiosks that
A year ago I cautioned that although big-box retailer Target (NYSE:TGT) seemed to have all of the building blocks in place for a successful turnaround, the future was still unclear and therefore it wasn't quite time to buy.Source: Mike Mozart via Flickr (Modified)Over the past 12 months, the clouds have parted and TGT stock's future looks pretty solid. Not only that, but the firm's share price doesn't reflect the promising growth on the horizon and that makes now a great time to take a position on Target stock. Strategy Starting to Pay OffThe most important metric for retailers is comparable-store sales because strong comps suggest that the shop is holding on to existing consumers and attracting new customers.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Small-Cap Stocks That Make the Grade For Target, same-store sales have been impressive for five consecutive quarters. In the most recent quarter comps were up 5% at Target with physical locations seeing 3.2% growth in same-store sales and digital sales up 36%. Target has struggled to keep up with peers like Walmart (NYSE:WMT) when it comes to building out an online presence, because the firm simply doesn't have the same size and reach that the discount superstore does. However, the firm has been focusing on productivity and efficiency and that strategy is starting to bear fruit.CEO Brian Cornell has focused on creating an omni-channel shopping experience that doesn't grow online sales at the expense of store traffic; that approach appears to be working. Target uses its existing locations as fulfillment centers which has allowed the firm to grow its Target.com business without jeopardizing sales at physical locations. Addressing ConcernsThings aren't all rosy for Target stock. The company took a hit on profitability in order to invest in its turnaround strategy. Gross margins in Q4 fell considerably from where they were a year earlier- but that's to be expected when you're building out an online presence. However, a temporary weakness in profitability in order to pave the way for long-term growth is a price worth paying.Another concern for investors has been Target's grocery business, which has struggled to compete against both Walmart and Amazon (NASDAQ:AMZN).Admittedly, the future of Target's grocery business is still murky. However, based on the company's success shifting its online strategy, I have faith that CEO Brian Cornell will implement a similarly air-tight plan to lift Target's grocery business in the years to come. Valuation and Target StockOne of the biggest reasons TGT stock should be on your watch list is the fact that the company isn't priced for a successful turnaround. At $76 per share the company's P/E ratio is significantly lower than the market average.Target trades at just 13 times its forward earnings, well below the S&P BMI consumer discretionary average of 20.65 times. Plus, Target offers a 3.3% dividend yield, which is above average for the sector. The Perfect StormTarget stock is in a sweet spot right now. The firm's turnaround looks to have firmly taken hold and although there are still obstacles to clear, the current environment is ideal for a retailer to pull off a strategy shift. However, the market isn't quite convinced yet and so TGT isn't priced to make a comeback. This is likely to be a strong year for Target, especially if its online business continues to turn in digital sales growth of 25% and higher.Investors are unlikely to cheer Target stock until profitability picks up significantly, but the most recent quarterly results suggested that the worst is over. Operating profits in the fourth quarter declined, but only because the previous year included an extra sales week. When you take away that advantage, margins were steady. In 2019, management foresees a modest increase in profits. The Bottom Line on Target StockTarget is ready to make a full fledged comeback and investors haven't jumped on the bandwagon just yet. Of course, there are still some kinks to be ironed out, but I'd say TGT is looking like a pretty good bet for 2019. As of this writing Laura Hoy was long AMZN. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 of the Best Stocks to Buy Under $10 * 7 Single-Digit P/E Stocks With Massive Upside * 7 Best Quantum Computing Stocks Trading Today Compare Brokers The post Buy Target Stock to Ride the Coming Untapped Growth Wave appeared first on InvestorPlace.
Amazon Is Capitalizing on These Key Advantages(Continued from Prior Part)Prime to reach over half of American households Amazon (AMZN) looks to be on track to reach a market penetration milestone with its Prime membership program this year. According
U.S. Treasury debt yields ticked up on Monday but made no significant moves as traders held off placing large positions ahead of the Federal Reserve's policy-setting meeting this week at which the U.S. central bank is expected to keep interest rates steady. The probability that the Fed will announce Wednesday that it will keep rates at the current 225-250 basis-point level was 98.7 percent on Monday, according to CME Group's FedWatch tool. Weak data published this month, including the government's employment report for February which drastically missed expectations, has supported the Fed's pause in rate hikes.
The retailer will move into a 90,000-square-foot, two-story space at a 300,000-square-foot outdoor center previously occupied by the defunct toy retailer.
TJX Companies' (TJX) off-price model, strategic store locations and impressive brands boost the company's performance. However, high wage and freight costs as well as currency woes are deterrents.
Let's see what to expect from FedEx's Q3 fiscal 2019 financial results, which are due out Tuesday, with larger global market conditions possibly trending in the wrong direction for the shipping and logistics powerhouse.
As the college admissions fallout continues, Crown Media announced that it dropped actress Lori Loughlin from the Crown Media Family Network. Yahoo Finance's Dan Roberts, Kristin Myers, and Akiko Fujita discuss.