Gene Munster Predicted Amazon Is Buying Target In 2018


Amazon is slowly becoming an all-encompassing mass that seeks to swallow up everything in its path. Jeff Bezos owns The Washington Post, Amazon's digital assistant is dominating the market, and it bought Whole Foods last year.

A new prediction has the company buying the second largest retailer in the United States, Target.

Amazon's New Target

Amazon made headlines last year after buying Whole Foods for $13.7 billion and is predicted to make even more headlines this year. Tech analyst Gene Munster is making the prediction that Amazon will buy Target in 2018.

The Loup Venture cofounder included this in a report where he made eight predictions for the technology industry in 2018.

"Amazon believes the future of retail is a mix of mostly online and some offline," said Munster in his predictions for 2018. "Target is the ideal offline partner for Amazon for two reasons, shared demographic and manageable but comprehensive store count."

In the report, Munster offers two reasons why Amazon may buy Target. First is the shared demographic between the two companies. Both companies target mothers and families. Amazon has targeted mothers through promotions around Prime, including stocking Prime Video with children's content.

Amazon's second reason for buying Target is the store's physical footprint. Even after acquiring Whole Foods and its own Amazon Go stores, its footprint is about 470 stores. Amazon sees Walmart as its main competition, and it has 11,695 stores all over the world. With the acquisition of Target, that would bump its presence to 2,300 stores.

News of the proposed deal sent Target's stock rising to 3.7 percent earlier this morning.

Setbacks In The Deal

A major roadblock in the deal could be government approval. President Donald Trump is no fan of Jeff Bezos. He previously mocked the Amazon-owner on his Twitter account, first saying the company doesn't pay "internet taxes" and then contending that Amazon doesn't use the United States Postal Service.

President Trump's administration has already flexed its muscle on the proposed purchase of Time Warner by AT&T. That deal hinged on the sale of CNN.

The numbers seem to favor Amazon even if it made the purchase that would put Walmart at about 23 percent market share and the proposed Amazon/Target merger at about 13 percent share.

Amazon has not made intentions on buying Target. This all comes as speculation from Munster. He is known for accurately predicting Apple's financial potential.

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