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Halftime: Is the Street overlooking Amazon's story?

Thursday, 31 Mar 2011 | 1:39 PM ET

A Morgan Stanley analyst on Thursday said investors are overlooking the opportunity in Amazon.com, as people change the way they shop and buy more goods online.

Scott Devitt has raised his price target on Amazon from $205 to $225 and suggested that the "bull case scenario" of $290 is starting to play out based on the assumption that it's taking market share from brick-and-mortar stores.

Book sellers Borders Group and Barnes & Noble , for example, are both experiencing dwindling sales. Meanwhile, electronics retailer Best Buy is also losing sales to e-retailers, like Amazon. He said customers are going to these physical stores, looking at the products and then making their purchases online.

"It really comes down to a simple question: If the Internet came first, would the hardline specialty retail segment exist in its current form?" Devitt asked. "I think the answer is no."

"At the end of the day, there's tremendous growth opportunity in terms of e-commerce and Amazon cleary is the leader in that," said Joe Terranova, chief market strategist at Virtus Investment Partners.

Amazon also beat competitors to the cloud, Devitt added. The Seattle-based company on Tuesday announced a cloud-based service that allows consumers to upload music files to Amazon's service and access them from any PC, as well as smartphones and Android-operated tablets.

Devitt doesn't think the cloud-based service will be a significant driver for Amazon's stock, but he does think it gives Android a one-up on the competition. Stuart Frankel's Steve Grasso, on the other hand, thinks Amazon's cloud-based services will drive a lot of investors to the stock. Grasso said it's just another reason to own this high-flying stock.

High-flying or not, CNBC's Scott Wapner pointed out that Amazon's stock has underperformed this year. Terranova said there's "seasonality" to investing in Amazon shares.

"What you do is you buy Amazon in August and you sell Amazon out as we approach the Christmas week," he explained.

Terranova wonders if Amazon's cloud-based services announcement caught investors off guard, though. It's possible, he said, they are under-invested in AMZN and if so, the stock could push above to $200 share.

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Are shares rallying ahead of the jobs report due out on Friday?

To get a better read on the employment situation, the "Fast Money" desk interviewed Paychex CEO Martin Mucci. on Thursday.

Watch the video to see the full segment.

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Trader disclosure: On March 31, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Grasso Owns (AMD); Grasso Owns (ASTM); Grasso Owns (BAC); Grasso Owns (BAC); Grasso Owns (C); Grasso Owns (CSCO); Grasso Owns (D); Grasso Owns (JPM); Grasso Owns (LIT); Grasso Owns (LPX); Grasso Owns (MHY) Grasso Owns (MU); Grasso Owns (NDAQ); Grasso Owns (PFE); Grasso Owns (PRST); Cortes Owns (SDY); Cortes Owns (EXC); Cortes Owns (SO); Cortes Owns (RIMM); Cortes Owns U.S. Dollar vs. Euro; Cortes Owns U.S. Dollar vs. British Pound; Cortes is Short (F); Cortes is Short (BAC); Cortes is Short (DBA); Cortes is Short (MOS); Jon Najarian owns (HES), Is Short (HES) Calls; Jon Najarian owns (RSH), Is Short (RSH) Calls; Jon Najarian owns (AKAM), Is Short (AKAM) Calls; Jon Najarian owns (AA), Is Short (AA) Calls; Jon Najarian owns (CBOE), Is Short (CBOE) Calls; Jon Najarian owns (CME), Is Short (CME) Calls; Jon Najarian owns (ITW), Is Short (ITW) Calls; Jon Najarian owns (NYX), Is Short (NYX) Calls; Jon Najarian owns (NTAP), Is Short (NTAP) Calls; Jon Najarian owns (DANG), Is Short (DANG) Calls; Jon Najarian owns (GNW), Is Short (GNW) Calls; Jon Najarian owns (HK), Is Short (HK) Calls; Jon Najarian owns (NTRI), Is Short (NTRI) Calls; Jon Najarian owns (ONN), Is Short (ONN) Calls; Jon Najarian owns (PCX), Is Short (PCX) Calls; Jon Najarian owns (TER), Is Short (TER) Calls; Terranova owns (CNQ); Terranova owns (RSX); Terranova owns (CVI); Terranova owns (DIS); Terranova owns (AKAM); Terranova owns (JNPR); Terranova owns (XOM); Terranova owns (IBM); Terranova owns (TEVA); Terranova owns (BAX); Terranova owns (PBR); Terranova owns (MS); Terranova owns (UPL); Terranova owns ( C); Terranova owns (JPM); Terranova owns (VRTS); Terranova owns (GS); Terranova is long (AAPL) puts; Terranova is long (AKAM) calls

For Steve Grasso
Stuart Frankel & Co and it's partners own (CUBA)
Stuart Frankel & Co and it's partners own (CSCO)
Stuart Frankel & Co and it's partners own (GERN)
Stuart Frankel & Co and it's partners own (HPQ)
Stuart Frankel & Co and it's partners own (HSPO)
Stuart Frankel & Co and it's partners own (MSFT)
Stuart Frankel & Co and it's partners own (NYX)
Stuart Frankel & Co and it's partners own (PFE)
Stuart Frankel & Co and it's partners own (PRST)
Stuart Frankel & Co and it's partners own (SDS)
Stuart Frankel & Co and it's partners own (XRX)
Stuart Frankel & Co and it's partners Are Short (QQQQ)
Stuart Frankel & Co and it's partners Are Short (AAPL)

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (KRC)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (LPHI)
Virtus Investment Partners Owns More Than 1% Of (NCRI)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of (DOM)

For Scott Devitt
Morgan Stanley Owned 1% Or More Of (AMZN) As Of Feb. 28, 2011
Morgan Stanley Has Recieved Investment Banking Compensation From (AMZN) In Last 12 Months
Morgan Stanley Expects To Recieve/Seek Investment Banking Compensation From (AMZN) In Next 3 Months
Morgan Stanley Has Recieved Non-Investment Banking Compensation From (AMZN) In Last 12 Months
Morgan Stanley Has In Last 12 Months Or Is Providing Investment Banking Services To Or Has An Investment Banking Client Relationship With (AMZN)
Morgan Stanley Has In Last 12 Months Or Is Providing Non-Investment Banking Securities-Related Services To Or Has An Client Relationship With (AMZN)
Morgan Stanley & Co. Is A Market Maker In (AMZN)
Morgan Stanely Is Acting As Financial Advisor To (AMZN) With Respect To Its Proposed Acquisition Of Quidsi, Inc., (AMZN) Has Agreed To Pay Fees To
Morgan Stanley For Its Financial Advice
Within the last 12 months, Morgan Stanley managed or co-managed a public offering (or 144A offering) of securities of Best Buy Co. Inc.
Within the last 12 months, Morgan Stanley has received compensation for investment banking services from Barnes & Noble, Best Buy Co. Inc.
In the next 3 months, Morgan Stanley expects to receive or intends to seek compensation for investment banking services from Barnes & Noble, Best Buy Co. Inc.
Within the last 12 months, Morgan Stanley has received compensation for products and services other than investment banking services from Barnes & Noble.
Within the last 12 months, Morgan Stanley has provided or is providing investment banking services to, or has an investment banking client relationship with, the following company: Barnes & Noble, Best Buy Co. Inc.
Within the last 12 months, Morgan Stanley has either provided or is providing non-investment banking, securities-related services to and/or in the past has entered into an agreement to provide services or has a client relationship with the following company: Barnes & Noble.
Morgan Stanley & Co. Incorporated makes a market in the securities of Barnes & Noble, Best Buy Co. Inc.

For Rich Ilczyszyn
**No disclosures

For Whitney Tilson SOT
Funds Managed By Whitney Tilson Owned (BRK.A) And (BRK.B) On 3/30/11

Comcast Is The Parent Company Of CNBC
Comcast Is The Parent Company Of NBCUniversal
GE Owns 49% Of NBCUniversal
GE Owns 49% Of CNBC

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