Amazon accounted for 30 percent of all growth in retail in the fourth quarter, but that doesn't mean the e-commerce giant is running out of room to make even more sales, according to a Wells Fargo survey.
About 85 percent of respondents in the survey were Amazon users, and 82 percent noted that Amazon is a top five shopping destination, Wells Fargo analyst Ken Sena wrote on Wednesday. "Despite this, 76 percent of Amazon-users use the site for less than 40 percent of their shopping (leaving much more room for increased purchase from existing users)."
The analyst increased his price target on shares of Amazon to $1,755 from $1,700, implying 10 percent upside from Wednesday's closing price. Shares of Amazon slipped 0.3 percent Thursday.
Under CEO Jeff Bezos' direction, Amazon has steadily poached traffic from traditional brick-and-mortar retailers, putting pressure on competitors like Walmart and Target.
Hoping to keep critics at bay, Target has been successfully fostering its apparel business, especially its private label ventures. Its Cat & Jack kids clothing brand generated more than $2 billion just one year following its launch, encouraging plans to introduce several more brands before the end of the year.
"The number that selected Amazon as a preferred shopping destination is significantly lower when compared to results from a year ago," noted Sena. "Even accounting for a margin of error, it could reflect the momentum seen at Target and Walmart in the last 12 months."
Shares of Target, which underperformed significantly during 2017, have turned around and are outperforming the S&P 500 over the past quarter, three months, six months and 12 months.