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Amazon Expands in Brazil With Prime Subscription Service

Zacks

Amazon AMZN has rolled out Prime Subscription services in Brazil, in order to strengthen presence in the Latin America.

Notably, Prime members in Brazil will now enjoy unlimited nationwide free shipping and a maximum 48-hour delivery time in more than 90 municipalities. Products eligible for Prime delivery will include all types of goods ranging from clothes to electronics.

In addition to these benefits, the Prime subscribers will have access to movies, music, and digital books and magazines on the Prime platform. This will likely increase Amazon’s subscriber base and give the online retailer an edge over online streaming services like Netflix.

Notably, the Brazilian Prime package will cost 9.90 reais ($2.42) a month, or 89.00 reais a year.


The latest move of the company, which will strengthen its footprint in Brazil, is in sync with continued focus on expanding presence in the Latin American region.

Amazon.com, Inc. Price and Consensus

Amazon Expands in Brazil

The company made its foray into the Brazilian e-commerce market in 2012. Notably, its expanding product portfolio bodes well. Amazon’s strong efforts to bolster market share by improving customer base in the country will further drive top-line growth.

The company has presence in the country’s online books and electronics retail markets. Last year, it had made foray into the clothing, accessories and footwear market of Brazil via its Brazilian marketplace.

In addition, it had announced plans to enhance product offerings by bringing a wide variety of fashion apparels and active sportswear ranging from designer Reinaldo Lourenco’s collection to Alpargatas’ Havaianas flip flops to Levi’s Jeans. The company further plans to sell these products through its e-commerce platform in the country and deliver the same by third-party vendors.

Notably, all these endeavors will continue to aid the company in gaining a competitive edge against domestic retail companies like Magazine Luiza, B2W and MercadoLibre, which is one of the dominant players in Latin America’s e-commerce space.

Brazil Holds Promise

We believe the above-mentioned customer benefits will aid Amazon in attracting customers to Brazil’s e-commerce platform. Further, these benefits will aid growth of Prime membership, which in turn will drive the top line.

With its strong endeavors, Amazon is likely to rapidly penetrate into the e-commerce market of Brazil, which, per a report from Statista, is expected to record $31.7 billion revenues by 2022 at a CAGR of 10.4% between 2018 and 2022.

Markedly, the company’s latest move bodes well for continuous focus on expansion of Prime’s global presence.

Moreover, rapid expansion of Prime in international regions will continue to aid its dominance in the global e-commerce space.

Zacks Rank and Stocks to Consider

Amazon currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Alphabet Inc. GOOGL, Itron, Inc. ITRI and MACOM Technology Solutions Holdings, Inc. MTSI, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings growth for Alphabet, Itron and MACOM Technology is currently projected at 17.5%, 25% and 15%, respectively.

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