One of the joys of covering Amazon.com (NASDAQ:AMZN) is that there’s never a shortage of cynics.

Here's a sampling of some of the comments posted after the company's market-thumping holiday quarter results.

  • "With a P/E like AMZN has, a little slip-up will bring it down just like most everything else."
  • "Classic bubble-like valuation on this stock."
  • "I'm not convinced they are the clear winner, not by a longshot."

Well, today there are fewer cynics in the naysayer crowd. Piper Jaffray analysts Gene Munster and Nicholas Gallus are upgrading their rating on the company from "neutral" to "buy."

The firm is encouraged by a survey it conducted of 300 online shoppers, showing a high level of customer satisfaction at Amazon.

One can always argue that the sample size is too small to have any real scientific merit, but you needn't look any further than January's robust quarter to see Amazon's appeal.

Net sales rose by 18% during the telltale holiday quarter. Do you think any of Amazon's rivals grew that quickly?

  • Wal-Mart (NYSE:WMT) is probably a logical guess, given the discounter's magnetism during soft economies. Unfortunately, you're way off. Total revenue at Wal-Mart rose by less than 2% in its latest quarter.
  • Overstock.com (NASDAQ:OSTK), you say? Yes, it combines the online retail prowess of Amazon with the thrifty-shopper allure of Wal-Mart, but Overstock's top line actually fell by 13% during the quarter.
  • eBay (NASDAQ:EBAY)? Don't even go there. The marketplace business shifted into reverse during the holidays.

So what's Amazon's secret? It can't simply be convenient online shopping, because other pure dot-com plays like Overstock and Blue Nile (NASDAQ:NILE) are shrinking. It may very well be the network effect in action, especially as Amazon ensures shoppers' loyalty with its Prime membership program. Prime effectively triggers repeat business, since members pay $79 a year for free two-day shipping on Amazon's merchandise.

Amazon is also making headway in shaking the stigma of being a low-margin retailer. One major area of improvement is the company's emphasis on digital delivery, eliminating the need for costly shipping and inventory expenses. Amazon is challenging the print publishing industry with its Kindle e-book reader, Akamai (NASDAQ:AKAM) in content-delivery networks, and Apple (NASDAQ:AAPL) in digital music and video delivery.

Maybe after watching Amazon excel over the past few years, cynics will realize that Amazon deserves a premium market multiple. After all, if it's doing so well now, just imagine how lively the company's virtual storefront will be when people have actual money to spend. 

Other headlines, if you still want to live in the past:

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Longtime Fool contributor Rick Munarriz has been shopping online for about as long as Amazon.com has been in business. He does not own shares in any of the stocks in this article. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.