An article on Forbes said that low profitability and worldwide expansion of Amazon.com, Inc. (NASDAQ:AMZN) could be the decisive factors in the company’s stock value and market position. Amazon.com, Inc. (NASDAQ:AMZN) is currently going through a massive transformation. Its Prime service and physical stores plans are starting to pay off. The source said that profitability index and margins will improve in the coming future for Amazon.com, Inc. (NASDAQ:AMZN) because the pressure from the investors is growing and this would force the Amazon.com, Inc. (NASDAQ:AMZN)’s management to take some serious steps to manage the margins, which are the real cause of low profits.
The source estimated that that international sales for Amazon.com, Inc. (NASDAQ:AMZN) related to electronics and general merchandise will increase by 17% to brush $95 billion over the next 6 years. This is because Amazon.com, Inc. (NASDAQ:AMZN) is heavily investing around the world to increase its operations beyond the US. The source mentioned that the company imbibes massive revenues from Europe, Japan and Asia. These markets will continue to flourish for Amazon.com, Inc. (NASDAQ:AMZN) in the near future because there is almost no competitor here to challenge the ecommerce giant. In China, Alibaba still remains the behemoth, and the local retail market is estimated to be worth $1 trillion by 2018. Amazon.com, Inc. (NASDAQ:AMZN) will have to elevate its presence in China because currently, it is suffering with a mere 1.5% market share.
The source mentioned that if Amazon.com, Inc. (NASDAQ:AMZN) succeeds in increasing its presence in Asia, the current valuation for the Amazon.com, Inc. (NASDAQ:AMZN) stock can be increased by 10% to $325.
Ken Fisher’s Fisher Asset Management owns over 2.4 million shares in Amazon.com, Inc. (NASDAQ:AMZN).
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