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Barron's: 4 Rival Online Retailers Keeping Up With Amazon

Barron's: 4 Rival Online Retailers Keeping Up With Amazon
(Jonathan Weiss/Dreamstime)

By    |   Thursday, 18 June 2020 09:18 AM

While Amazon.com Inc. still towers above the online-retail competition, at least one expert sees four rival companies holding firm against the e-commerce titan.

Analyst Christopher Horvers explained that Amazon’s (AMZN) growth last year was fueled mostly by its rollout of Prime One-Day shipping, the surge in third-party sellers, and big gains in underpenetrated categories like apparel and consumer packaged goods, Barron’s reported.

Hovers said most of Amazon’s rivals “lag in the race for same-day/next day.” Horvers calls the need for free fast shipping and a comprehensive omnichannel platform “a regressive tax on small competitors,” while at the same time, “category leaders [are] able to catch up relatively quickly,” Barron’s quoted him as saying

He cited Tractor Supply (TSCO) as “making the most impressive strides,” and he thinks Michaels (MIK) will be the “next category leader to catch up.”

He sees Walmart (WMT) and Target (TGT) as “the retailers with the biggest moat of safety from Amazon, although he warns they will have to keep investing to maintain their defenses,” Barron’s said.

“These two also have expanded their grocery offerings in recent years, and Horvers notes that online grocery grew more than 30% last year, a trend most certainly guaranteed to rise in 2020 thanks to the pandemic. Consumers are slowly getting more comfortable with the idea of having even perishable items like produce delivered,” Barron’s said.

“One knock against Amazon is that the pandemic has meant many Prime items have been delivered well outside the one- or two-day window; and companies like Walmart and Target can leverage curbside pickup for consumers who want their goods within hours.”

And while there is no denying May's $73 billion rebound in U.S. retail sales was an eye-popper and is the latest fodder to fuel the red-hot "V" vs "U" debate about what kind of recovery to expect from the COVID-19 recession.

Even Federal Reserve Chair Jerome Powell, who has taken pains lately to caution everyone that this is likely to be a fitful and for many a painful recovery, called Tuesday's retail sales report from the Commerce Department an encouraging sign.

But, to be clear, while the rebound was strong overall, sales remain 8% below where they were in February, and many corners of retail are miles shy of where they were just three months ago when coast-to-coast stay-at-home orders brought many businesses to a full standstill, Reuters explained.

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While Amazon.com Inc. still towers above the online-retail competition, at least one expert sees four rival companies holding firm against the e-commerce titan.
amazon, online, retail, stocks
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2020-18-18
Thursday, 18 June 2020 09:18 AM
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