AMZN Stock: Amazon Eyeing The Next Massive Trillion-Dollar Market

Amazon is one of the largest shippers in the U.S. Trucking is one of the biggest industries in the country. It was only a matter of time before technology found a way to connect the two.

Amazon AMZN stock

As reported by Business Insider, an unnamed but reliable source has confirmed that Amazon.com, Inc. (NASDAQ:AMZN) is currently working on a trucking app that will connect truck drivers with cargo shippers, similar with the way Uber connects its drivers with riders. The app is supposedly targeted for launch in summer next year.

Aside from the convenience it will bring — making it easier for shippers to find the most ideal trucker to meet their needs — it is also meant to remove third party brokers from the picture. Without these ‘middle men’ and their commissions, shipping will be less costly for freight owners, and revenue will be higher for truckers.

According to the report, the app will offer services like real-time pricing, driving directions, and other features like truck stop recommendations. It might also include payment and tracking options to expedite completion of the shipping process.

Is Amazon Becoming a Logistics Company?

The move to insert itself into the $800 billion trucking industry is not surprising, especially considering that Amazon has certainly grown big enough to handle the delivery process from start to finish. Besides, we’ve seen plenty of markers indicating that the company might be heading towards the direction of becoming a full-fledged logistics company.

In the recent months, Amazon has leased several cargo planes; bought thousands of trailer trucks which they branded with the company’s name; added a number of fulfilment center warehouses; and allowed Amazon China to ship goods from China to the U.S. by registering Amazon China as an ocean freight forwarder. And let’s not forget how at the start of this year, in the Cost of Sales section of their 2016 10-K report, they referred to their company as a ‘transportation service provider’ for the very first time.

There’s also Amazon Flex — the service that’s designed to meet delivery demand without relying on Amazon’s usual partners, namely, FedEx, UPS, and the U.S. Postal Service. Just like Uber’s system, Amazon Flex allows anyone with a private vehicle to deliver packages bought from Amazon. Up to this point, however, public acceptance is still questionable, particularly after reports of customers freaking out as their packages were delivered by civilians instead of uniformed delivery personnel.

Although there’s no official word from Amazon yet, the news about an upcoming Amazon trucking app is not too hard to believe. In fact, our question shouldn’t even be about whether the news is true or not. The question we really should be asking is this: What took Amazon so long?

Amazon Stock

On a separate yet related news, Amazon stock lost $3.60 to $757.40 in mid-day trading Friday. Approximately 3.4 million shares changed hands, compared to the stock’s average daily volume of 4.20 million shares.

On valuation-measures, shares of Amazon have a trailing-12 and forward P/E of 173.51 and 84.04, respectively. P/E to growth ratio is 4.22, while t-12 profit margin prints 1.64%. EPS registers at $4.37. The company has a market cap of about $360 billion and a median Street price target of $937.50 with a high target of $1,250.00.

On trading-measure, Amazon stock has a beta of 1.43 and a short float of 6.54 million. In the past 52 weeks, shares of Seattle, WA-based e-commerce giant have traded between a low of $474.00 and a high of $847.21 with 50-day moving average (MA) and 200-day MA located at $765.52 and $765.67 levels, respectively.

Amazon stock currently prints a one year return of about 12 percent, and a year-to-date return of around 13 percent.

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