Strong holiday sales and new products should make Amazon.com and Apple big winners looking ahead, one analyst said Wednesday on “Fast Money.”
, managing director and senior research analyst at Piper Jaffray, set an Amazon.com price target of $256 per share.
Munster said he liked Amazon’s offer of $5 rebates for using its Price Check appwhile shopping at brick-and-mortar retailers.
“They’re taking this holiday fight right to the face of retailers, right in their stores,” he said. “This is yet another clever promotion that Amazon’s doing that doesn’t cost a lot of money, that’s kind of underscoring this fight that Amazon’s having with the offline world.”
The promotion, which Munster said will cost the online retailer around $1.1 million, represents approximately 0.25 percent of its annual marketing budget.
“This is a creative tactic that Amazon’s using when it’s spending all that investor money,” he said, adding that with Amazon working on same-day delivery services, it is also well-positioned to take on competitors.
Taking on Verizon, Netflix & Apple
Munster said Amazon Prime, the company’s streaming video service, would not be affected by Verizon’s plans to challenge Netflix with its own web TV service.
“People don’t get prime because of the video service, so they really haven’t really put much weight into it,” he said.
Apple will likely also move into the video streaming market within the next year or so, Munster predicted.
“This is going to get really competitive, but it doesn’t really change how Amazon sees the world,” he added.
While Amazon did not break out robust sales of its Kindle Fire, which performed well on Black Friday, but Munster estimated sales at around 4 million units for the quarter.
That represents almost 5 percent of total sales, compared to the iPad accounting for 20 percent of Apple sales.
“There’s a lot of controversy that the iPad numbers are going to be soft this quarter,” he said. “The work we’ve done since Black Friday has shown really good demand. It’s showing 65 to 90 percent year-over-year growth. The street’s looking for about 80 percent growth.”
Munster said he liked the iPad’s strength, with a new version expected at the beginning of next year.
“We’re still very bullish on the iPad despite some of the apprehension on the street,” he said.
Steve Cortes, however, reiterated his short on Apple.
“Clearly, the analyst community disagrees with me,” he said. “But that’s one of the reasons I’m short, that the analyst community is so unanimously bullish on Apple.”
Cortes said investors and the media have been in love with Apple for good reason but took issue with the stock's performance over the past three months.
“I think the main point is: It has gotten so big, it’s hard to move the needle from here,” he said.
The Kindle, he added, would pose a threat to Apple.
“It’s going to be an iPad killer,” said trader Steve Grasso. “I don’t pick up my iPad anymore.”
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Trader disclosure: On Dec 7, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Najarian is long AAPL; Najarian is long C; Najarian is long JPM calls; Najarian is long WFC calls; Najarian is long MSFT; Najarian is long INTC; Najarian is long YHOO; Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU; Lindzon is long LPSN; Lindzon is long AMZN; Lindzon is long INTU; Lindzon is long ARBA; Cortes is long Treasuries; Cortes is long INTC; Cortes is long KR; Cortes is long TSN; Cortes is short EUR; Cortes is short DB; Cortes is short XRT vs. S&P long
For Steve Grasso
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For Charles Grom
DOLLAR GENERAL (DG) is an investment banking client of DBSI and has received non-investment banking related compensation from this company in the past year.
For Alexandra Lebenthal
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For Gene Munster
The following companies have been investment banking clients of Piper Jaffray during the past 12 months: ACOM, DANG, DRIV, MOBI, YNDX, YOKU
Other material conflicts of interest for Gene Munster or Piper Jaffray regarding companies in my universe for which I am aware include: ACOM, DANG, MOBI, YNDX, YOKU: underwriting
Piper Jaffray received non-investment banking securities-related compensation from the following companies during the past 12 months: ACOM, DRIV
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