Amazon.com, Inc. (AMZN): Big and Getting Bigger

The company later went on to report a first quarter EPS of $0.93, in line with the consensus estimate. Bed Bath & Beyond Inc. (NASDAQ:BBBY) might have dodged a bullet on this quarter, but investors have to wonder how long the company can survive off coupons and other promotions, which make some of their products nearly 15% less expensive than on Amazon.com, Inc. (NASDAQ:AMZN).

A strategy relying on coupons weighs on the company’s margins and can limit profit upside. Investors should keep a close watch on future earnings and be ready to sell shares at the first sign of trouble.

Conclusion

Online shopping continues to gain popularity to this day as Amazon.com, Inc. (NASDAQ:AMZN) has streamlined the shopping experience to make it easy and convenient with a product selection equal to that of virtually every big box retailer.

Personally, I believe that investors should stay clear and avoid investing in retailers that compete directly with Amazon.com, as it’s possible that nearly every retailer could feel some sort of effect from Amazon in the coming years as companies (such as Bed Bath & Beyond Inc. (NASDAQ:BBBY)) can successfully fight off the threat for the coming quarters, but can’t sustain the battle long term. There is a reason why Amazon.com grew its market share from just 1% in 2004 to where it stands today, and Amazon.com, Inc. (NASDAQ:AMZN) still has incredible growth trajectory for many years to come.

Jayson Derrick has no position in any stocks mentioned. The Motley Fool recommends Amazon.com and Bed Bath & Beyond. The Motley Fool owns shares of Amazon.com.

The article Amazon: Big and Getting Bigger originally appeared on Fool.com.

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