Since Amazon.com (AMZN) does not offer a dividend to its investors, and it endured a 35 percent drop in net income for the first quarter, I cannot outright support buying Amazon stock at its current share price. However, if Amazon stock pushed on that floor price again, even if it only gets to $180, I would consider buying its stock. Amazon, however, seems intent on continuing its success via expanding technology and improving its revenue streams. Amazon moved away from its online bookstore original business model when it started selling the Amazon Kindle, which has become the most popular e-reader. Furthermore, Amazon earns revenue every time a Kindle user buys a book, movie, or game on Amazon.com. However, the Kindle is outmatched in the tablet race by Apple’s (AAPL) iPad.
Recently, Target (TGT) announced that it would stop advertising Amazon’s products, mainly its Kindle, and speculation is that the company will begin to focus on Apple products, specifically the iPad and the company doesn’t want to mix the two. This is indicative of the split with these tablets and Target’s move may become a trend for stores to specifically market only one major tablet product.
While Amazon’s Kindle has found success, it is not without competition in the e-reader market. Microsoft’s (MSFT) investment of $300 million into a join venture with Barnes & Noble (BKS) will give Microsoft about an 18% stake in Barnes & Noble’s e-reader the Nook. To continue reading, click here.