Stocks to Watch After Prime Day 2019

Prime Day has turned into the ecommerce version of “Christmas in July,” with discounts and deals as far as the eye can see. As shoppers log in and click their way to big savings, LikeFolio got busy analyzing consumer behavior to find out which retailers and device makers benefitted the most.

Prime Day 2019 Sets Revenue Records

Amazon reported that Prime Day 2019 was “the largest shopping event in its history,” citing sales surmounting 2018’s Black Friday and Cyber Monday combined. This checks out. Consider the chart below, plotting LikeFolio purchase intent mentions from Prime Day events since conception in 2015. Revenue topped 4 billion last year, and this can be expected to grow significantly.

Purchase intent mentions have historically correlated to Prime Day revenues, and are showing significant YoY growth in 2019.

Purchase intent mentions have historically correlated to Prime Day revenues, and are showing significant YoY growth in 2019.

This isn’t relegated to Prime Day alone. This is the largest Amazon “spike” (high-volume date) LikeFolio has ever recorded — on any day, in the history of the company!

2019 Prime Day registered the largest Purchase Intent spike in LikeFolio’s history.

2019 Prime Day registered the largest Purchase Intent spike in LikeFolio’s history.

Competitors are also benefitting from Prime Day

Target, Walmart, and eBay all battled for a piece of the sweet, summer-splurge pie, offering deal days in conjunction with Amazon’s self-made holiday. The chart below displays the purchase intent growth captured by several retailers through the event.

Amazon, first out of the gate with a huge head start, is cruising leisurely ahead with steady growth. This level of growth wouldn’t seem small if it didn’t pale in comparison to some of their retail competitors.

Target’s concerted effort to ride the wake of Amazon’s big day paid off in a big way as the company posted an enormous 59% year over year growth in purchase intent mentions during the big event.

Walmart and eBay experienced Purchase Intent growth levels of 49% and 31% respectively.
A rising tide does indeed lift all boats.

At the end of the day, Amazon is still King.

Amazon reigns supreme for two main reasons: 1) Market Share Dominance, 2) Owned-Product Adoption

Market Share Dominance

If you only consider the Retail Prime Day Growth chart above, it may appear Amazon is falling behind the retail pack regarding growing Prime Day profits. However, scale is needed. When viewed in conjunction with the total volume of purchase intent mentions of “Shopping on Prime Day,” the big picture comes into focus.

Amazon dwarfs the retail competition — as they should. This spending holiday is their brainchild. While it is important to monitor for shifts in this consumer spending behavior, so far competitive efforts have not begun to stifle Amazon’s prowess.

Owned-Product Adoptions

Not only are more people shopping via $AMZN, they are buying Amazon-owned products. This is brilliant in regard to profit margin, as well as private label adoption. LikeFolio tracks mentions of every owned product sold by Amazon — from their batteries to their smart devices.

What were the most desired products on Prime Day according to LikeFolio keyword analysis?
Fire TV and Echo Devices.

Amazon continues to quench the consumer thirst for “smart” electronics, with chatter increasing for Fire TV sticks and Alexa-enabled smart speakers by 27% and 33% respectively. A low price point and the abundance of product bundles brought repeat consumers to the table, ensuring an Alexa for voice-commands ready in every room.

In addition to these smart devices, Amazon effectively leveraged acquired Ring video doorbell offerings. Mentions of Ring Doorbell products increased 239% in the 2019 Prime Day event, compared with Prime Day 2018.

3rd-party product vendors also BOOMED

While many vendors use Amazon as a vehicle for sales, some companies capitalized more than others. Consider the chart below, highlighting tickers with significant Purchase Intent increases from 2018 to 2019.

The products with the most consumer demand for each of these companies were as follows:

• iRobot ($IRBT): Roomba
• Garmin ($GRMN): Vivoactive 3, Forerunner
• Roku ($ROKU): Roku 3
• Whirlpool ($WHR): Kitchenaid Mixer
• Crocs ($CROX): (duh)
• Canon ($CAJ): EOS Rebel, g7x

Breaking Down the Stocks Riding The Prime Day Wave

AMZN clearly had a huge event, with more shoppers than ever clicking the buy button on an increasing number of the high-margin products they create. Despite this, a cautious outlook on Amazon is warranted, with LikeFolio having a bearish outlook on the company and TradeStops SSI in the Red Zone.

TGT had a phenomenal event as well, with a massive increase in purchase intent mentions vs the Prime Day event of 2018. This stock is currently in the Green Zone on TradeStops, with LikeFolio showing a Bearish outlook overall.

CAJ may be the biggest surprise of the entire event, with its products seeing purchase intent increases of more than double their 2018 numbers. LikeFolio has a neutral outlook on this stock, and the TradeStops SSI is currently in the Red Zone, but with numbers like they put up this week, that might not be the case for long.

CROX had an incredible Prime Day event, stacking up 120% more purchase intent mentions in 2019 than it did in 2018. LikeFolio has been bullish on CROX since it put out a Bullish Opportunity Alert on the company last month in the $18 range, while the TradeStops SSI is currently sitting in the Red Zone.

ROKU was another big winner this week, as consumers gobbled up deals on ROKU-enabled television sets and its own streaming devices. TradeStops’ SSI on ROKU is in the Green Zone on this Sky High Risk stock, while LikeFolio’s outlook has recently shifted to Bearish after an incredible run for the company’s shares from under $40 to over $110!

The Bottom Line

One event does not a great stock make, but it’s definitely worth noting which companies consumers preferred to do business with during the biggest shopping event outside of Black Friday. As expectations rise regarding shipping price and speed, it’s important to watch who can deliver, and who can’t make the cut.

In the meantime, Summer Santa better get ready for Thanksgiving — because Black Friday is just around the corner.

Andy Swan

Co-founder, LikeFolio