| From: Glenn Petersen | 12/14/2019 9:48:16 AM | | | | | | Watch out, UPS. Morgan Stanley estimates Amazon is already delivering half of its packages
Published Thu, Dec 12 201911:24 AM EST
Updated Thu, Dec 12 20192:43 PM EST
CNBC.com
Michael Sheetz @thesheetztweetz
Key Points
- Amazon Logistics is the e-commerce giant's in-house logistics operation.
- "Our AlphaWise analysis shows that Amazon Logistics already delivers ~50% of Amazon US volumes, focused on urban areas," Morgan Stanley said.
- The firm estimates Amazon Logistics will reach a volume of 6.5 billion packages per year by 2022, far exceeding its estimate for UPS at 5 billion packages per year and FedEx at 3.4 billion packages per year.
Amazon is already delivering about half of its own packages in the U.S., according to a Morgan Stanley estimate on Thursday, and will soon pass both United Parcel Service and FedEx in total volume.
"Our AlphaWise analysis shows that Amazon Logistics already delivers ~50% of Amazon US volumes, focused on urban areas," Morgan Stanley said.
Amazon Logistics is the e-commerce giant's in-house logistics operation. Morgan Stanley said Amazon Logistics "more than doubled its share" of U.S. package volumes from about 20% a year ago and is now shipping at a rate of 2.5 billion per year. For comparison, Morgan Stanley estimates UPS and FedEx have U.S. shipping volumes of 4.7 billion and 3 billion packages per year, respectively."
"We see more of this going forward as our new bottom-up US package model assumes Amazon Logistics US packages grow at a 68% [compound annual growth rate from 2018 to 2022]," Morgan Stanley said.
That would put Amazon Logistics at 6.5 billion packages per year by 2022, according to the firm, far exceeding its estimate for UPS at 5 billion packages per year and FedEx at 3.4 billion packages per year.
"To us, Amazon Logistics is already-large scale and with a fleet ~1/5 the size of competitors, it speaks to its ability to use density and technology to drive efficiency," Morgan Stanley said.
20% upside?
The firm says Amazon Logistics is more focused than its competitors on densely populated areas. According to Morgan Stanley's estimate, about 61% of Amazon Logistics' package volumes are from suburban areas, 28% are from urban areas, and just 11% are from rural areas. That makes Amazon Logistics' rural focus about half of its competitors, as the rest of the industry typically derives 20% of package volume from rural areas, the firm said.
Morgan Stanley has an overweight rating on Amazon shares, with a $2,100 price target that is nearly 20% above the stock's current level.
The firm also lowered its price target on both UPS shares to $78 from $85 — about 33% below its current price — and FedEx shares to $111 from $120 — which would be a drop of about 32% from current levels. Morgan Stanley has an underweight rating on UPS and an equal-weight rating on FedEx.
— CNBC's Michael Bloom contributed to this report.
cnbc.com
|
| | Amazon.com, Inc. (AMZN) | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| From: Sr K | 12/18/2019 3:36:01 PM | | | | | | 3:24 PM
AMAZON SAYS BUILDING PROJECT KUIPER RESEARCH AND DEVELOPMENT HEADQUARTERS IN REDMOND, WA |
| | Amazon.com, Inc. (AMZN) | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| From: Glenn Petersen | 12/19/2019 9:24:02 AM | | | | | | Amazon flexes its formidable shipping arm
Erica Pandey
Axios
December 19, 2019
After conquering e-commerce and cloud computing, Amazon is claiming its spot at the very top of the massive shipping industry this holiday season.
Why it matters: Logistics might make your eyes glaze over, but it's one of the key businesses of the future — and it could become Amazon's next windfall. The industry is already worth $1.5 trillion, and it'll get even bigger as more and more people order everything online.
By the numbers: Cyber Monday was Amazon's highest volume shopping day ever. And Americans will spend a record $135 billion online in November and December, Spencer Soper writes in Bloomberg's tech newsletter today.
What's happening: Amazon is already the leading shipper of its own packages (delivering about 48% of them). The tech giant is adding vans, jets, workers and warehouses to become an even more formidable shipper.
Amazon's rise is putting legacy shippers at risk. After brushing off the e-commerce giant as a competitor for years, FedEx CEO Fred Smith called it a threat this year.
-- The two companies have cut ties. FedEx chose not to renew its ground and air delivery contracts with Amazon.
-- And just this week, Amazon — which is consumers' most-trusted brand to deliver their holiday gifts in time — is banning its third-party sellers from using FedEx for ground deliveries. It's effectively a no-confidence vote in FedEx, writes Soper.
-- FedEx reported weaker-than-expected earnings this week and revised its 2020 earnings outlook down. The stock is down around 10% today. The stakes: Amazon is already the subject of antitrust investigations in the U.S. and Europe, and its shipping prowess could strengthen opponents' arguments.
-- "Given its scale & dominance of this market, Amazon is essentially operating as a regulator of shipping companies," notes Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a nonprofit research and advocacy group that opposes concentrated economic power. axios.com |
| | Amazon.com, Inc. (AMZN) | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| From: Sr K | 12/23/2019 5:31:35 PM | | | | | | | Amazon's One-Day Shipping Will Distance It From Competitors, Piper Says -- Barrons.com |
| | Amazon.com, Inc. (AMZN) | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| From: Sr K | 12/23/2019 5:37:11 PM | | | | | | Amazon's One-Day Shipping Will Distance It From Competitors, Piper Says
Piper Jaffray analyst Micheal J. Olson reiterated his Overweight rating for Amazon ..
-- Barrons.com |
| | Amazon.com, Inc. (AMZN) | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| |
