Amazon's market-share gains are nothing new, of course. The company has been defying gravity for most of the past three years. It accelerated its top-line growth until it eased its foot off the gas in the second half of 2008.
Amazon is clearly still growing faster than the rest of the market. It even had its "best ever" holiday shopping season last month, just as Amazon's dot-com rivals followed real-world chains into the tank.
Whether Amazon's margins held up during the cutthroat season remains to be seen, but you have to like the company's odds. As the fulfillment partner for many high-profile third-party merchants, including Target
Over the years, Amazon bears have argued that bricks-and-mortar chains such as Wal-Mart
I think the key to Amazon's success is its Prime membership program, with which customers pay $79 a year for free two-day shipping of Amazon-stocked items. It's a lot like paying for membership at warehouse clubs such as Costco
So what can hold Amazon back at this point? Well, the stock's valuation is certainly not bargain-bin fodder. Shares are trading 55% higher since bottoming out two months ago. Even Khan's price target of $65 is just a roughly 20% advance from where the stock is at right now. However, it's hard to bet against what may be one of the only retailers bragging about its performance in the holiday shopping season.
Short Amazon at your own peril.
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