Amazon shares top $ 1,000

Momentum on its side — for now — as competition heats up

Shares of Amazon topped $ 1,000 Tuesday, a milestone that reflects its meteoric rise. So, next stop $ 2,000?

Analysts on Wall Street are overwhelmingly bullish — only one brokerage has a hold and none have “sells”, according to Bloomberg terminal data — and some of the most optimistic see shares hitting $ 1,250 in the next 12 months. Few want to miss out on one of the Internet’s biggest stock runs. Amazon shares are up 38% from a year ago and 14 times more valuable than they were a decade ago.

Yet momentum doesn’t last forever, an investing reality Apple shareholders finally faced two years ago.

The biggest threat to Amazon is the competition coming up in its rearview mirror, analysts say. In part because of CEO Jeff Bezos’ willingness to continually reinvest in research and new areas, the Seattlebased company has long had a massive first- mover advantage in both retail and Web services. That is now changing.

“Amazon is still the leader but the competitive environment is intensifying,” said Ed Yruma, managing director at KeyBanc Capital Markets.

Effectively, Amazon is two companies, one a retail e- commerce company building out a global marketplace, the other a cloud storage and services company that accounted for the biggest share of the company’s consolidated operating income in the first quarter of 2017, outflanking retail profits.

On the retail side, archrival Walmart is the main potential roadblock to Amazon’s continued growth. Determined to move into e- commerce and with the advantage of a massive brick and mortar store base, Walmart is increasingly dynamic, Yruma said. Walmart has focused its efforts more on middle- income consumers.

“You’re going to see more of the middle- income consumer moving to e- commerce — and they don’t have any loyalty to Amazon,” Yruma said.