Amazon's (AMZN) Prime Day sale lived up to the hype on Tuesday, according to analysts at JMP Securities who reiterated their Outperform rating and $775 price target. JMP's price target represents a potential 3.5% upside from the stock's current level.
"Our biggest takeaway is the strength of Amazon's device sales whereby sales grew 3x Y/Y domestically, which we view as a long-term strategic positive as Amazon builds out its broader ecosystem beginning with Prime memberships, extending to video, music and books, and increasingly the connected home," analysts at the firm said.
The company was able to sell 2.5 times more Amazon Fire TV devices this year compared to last year, while also selling hundreds of thousands of Kindle e-readers.
Amazon -- a key holding of the Growth Seeker portfolio -- pointed higher in afternoon trading Thursday after losing some ground on Wednesday following the conclusion of the sale. The company announced that customer orders grew 60% worldwide, and 50% in the U.S., from last year's inaugural Prime Day.
"Prime itself is the best deal in the history of shopping, and Prime Day was created as a special benefit exclusively for our Prime members," said Amazon Prime Vice President Greg Greeley. "We want to thank our tens of millions of members around the world for making this the biggest day in the history of Amazon."
Last year, Amazon's stock rose 6% in the week following Prime Day, and Growth Seeker co-managers Chris Versace and Lenore Hawkins believe this year's Prime Day could also be a strong catalyst for the online retailer going forward.
"While details were limited, Amazon did say that orders for its own devices, Amazon Fire TV and Amazon Echo, were particularly strong," Versace and Hawkins wrote. "The company also shared that sellers on Amazon offering deals to Prime members saw their orders nearly triple year over year."
Despite the multiple positives, the Growth Seeker team postulated that the outsized expectations the market had ahead of the sale could be hurting the company.
However, the near-term dip didn't dissuade Versace and Hawkins from their bullish stance on Amazon.
"All of this just provides a smidgen more upside to our $880 price target compared to earlier in the week. We continue to favor the shares as we move deeper into the consumer-shopping filled second half of the year," the pair said.
Last week, Amazon reached a new 52-week high and the stock is up more than 10% year-to-date, easily outperforming the wider market. While the first half of the year has been extremely positive for the company, Amazon has plenty of catalysts ahead to help it finish the year on an even stronger note, according to the Growth Seeker team.
"Heading into the seasonally strong shopping season in the back half of the year, we see Amazon benefiting from the accelerating shift toward digital commerce as it continues to expand its offerings and geographic footprint," Hawkins and Versace said. "The next few signposts to watch will be this week's June retail sales report, the National Retail Federation's back-to-school spending forecast in a few weeks and quarterly earnings from United Parcel Service (UPS) on July 29. We expect this to confirm the accelerating shift to online and mobile shopping."