Based on market capitalization it seems obvious to many that Apple Inc. AAPL 0.16%, valued at $803 billion, will be the first trillion dollar company. But some are making the case that Amazon.com, Inc. AMZN 1.77%, which is valued $300 billion less than Apple will reach the milestone sooner.
There is “very little to stop” Amazon’s stock value from doubling to $2,000, which would imply a $1 trillion valuation, James Cakmak, an internet equity analyst Monness, Crespi, Hardt & Co. said during CNBC’s “Squawk Box” segment on Thursday. The reason for this is simple: Amazon’s dominance in the online internet selling space continues to get bigger and better by the day given its ability to offer better prices, a better shopping experience, and perhaps most importantly, access to better data.
Whole Foods’ revenue in the most recent quarter of $3.725 billion is roughly 10 percent of the $37.16 billion Amazon is expected to report its earnings Thursday.
However, Amazon likely has big plans for its acquisitions and could lower prices on food sales to the point where gross margins are nearly zero to entice consumers in to buying higher margin and more lucrative items, such as the prepared food market which itself is bigger than the grocery market.