Growth Stock Amazon Diversifies with Pharmacy Purchase

June 29, 2018
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Amazon.com Inc. (NASDAQ: AMZN) has been one of the strongest performers in the stock market during the first half of 2018. Both long term investors and short traders have shown a great deal of confidence in the company, and stock price has grown 45.49% since January. In the face of early year volatility, and the more recent trade worries, Amazon has been one of the most resilient stocks on the market. Even while trade disputes have dominated headlines this month, Amazon stock still managed 3.65% growth.

There’s no question that this stock has been a winner in 2018 and it continues to receive a buy signal from the most trusted analysts.

Amazon is Expanding Its Business and Plans to Disrupt the Pharmacy Industry

The ability to disrupt established markets is one of Amazon’s greatest strengths. From humble beginnings as an online book retailer, Amazon is now the world’s largest ecommerce company, and it has diverse interests in entertainment media, smart devices, internet services, and will now have a stake in the pharmacy business.

It was announced on Thursday that Amazon would be purchasing PillPack, an online pharmacy company that has licenses to operate in all 50 states. PillPack specializes in sorted deliveries of medication. The company packages doses individually to make it easier for customers to stay up to date with their prescriptions.

The $1 billion purchase gives it a potentially disruptive position in an industry that is currently dominated by brick and mortar pharmacy stores.

The impact of the acquisition is already making waves in the market, with CVS Health Corp. (NYSE: CVS) falling -6.10% on Thursday, and Walgreens Boots Alliance Inc. (NASDAQ: WBA) falling -9.90% on the same day. These companies, two of the largest in the pharmacy business, will now struggle to maintain investor confidence.

It is yet to fail in any industry that they’ve entered. Their vast distribution network and customer base combined with PillPack’s infrastructure and licenses will create tough competition for traditional pharmacies.

Amazon Remains One of the Smartest Long-Term Investments

Amazon has an excellent leadership structure, one of the world’s most powerful brands, it regularly reinvests in industries and projects that increase profits, and in the past three years it has suffered no significant stock price crashes. Stock today is worth $1,701.99 per share.

It is a pricey stock, but it has the best possible prospects for long term growth and sustainability. For long term investors looking for an option that displays historical growth, Amazon is one of the best out there.

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