A source told Nikkei Asian Review that the Japan Fair Trade Commission has raided Amazon.com, Inc. (NASDAQ:AMZN) Japan office on Monday on suspicions the company is unfairly forcing retailers to favor its website over its rivals.
The anti-monopoly watchdog agency is suspecting Amazon Japan of requiring vendors that they have on their site to sell their products at a lower price than that of the other websites. Japan’s anti-monopoly act prohibits these kinds of activities from companies that the country has relations with.
Amazon Japan’s spokesperson declined to comment on the matter.
Nobuyoshi Suzuki, a lawyer with expertise in Japan’s anti-monopoly law told The Wall Street Journal that Amazon won’t need to cease its operations in the country. The e-commerce giant, though, could be sued by its rivals for compensatory damages. Japan’s other major e-commerce players are Rakuten Inc. and Yahoo Japan Corp.
Amazon’s annual report showed that its office in Japan had bought $8.3 billion in sales in fiscal-year 2015, about 7.7 percent of Amazon’s global net sales.
Despite this latest incident with one of Amazon’s satellite office, the company’s stock remains an attractive option for investors and traders.
TheStreet reports that their Ratings Team has a buy rating on Amazon with a score of B- on the stock. This is due to the company’s strength, which can be seen in multiple areas.
Among the Amazon’s strengths are its impressive record of earnings per share growth and its compelling growth in net income. Amazon also has expanded its profit margins, a robust revenue growth and good cash flow from its operations.
The Ratings Team also believes that Amazon’s strengths outweighs the company’s generally high debt management risk by most measures that were evaluated. The company’s strengths also far outweighs any negative effects that could be brought about by this latest incident.
Price Action
Shares of Amazon gained $0.96 to close at $766.90 in Monday’s Nas trading, giving it a market cap of roughly $363 billion.
On valuation measures, AMZN stock has a trailing-12 and forward P/E of 190.48 and 73.94, respectively. P/E to growth ratio is 2.62, while t-12 profit margin is 1.60%. EPS registers at $4.02. The company has a median Street price target of $876 with a high target of $1,000.
On trading-metrics, Amazon has a beta of 1.68 and a short float of more than 5.4 million. In the past 52 weeks, shares of Seattle, Washington-based company have traded between a low of $451.00 and a high of $770.50, with a 50-day moving average (MA) and 200-day MA located at $735.36 and $646.13 levels, respectively.
Amazon stock currently prints a one year return of about 45 percent, and a year-to-date return of around 13 percent.
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