The Wall Street Journal had reported Amazon.com, Inc. (NASDAQ:AMZN) planning a huge expansion of Amazon Prime Video that would rival video streaming offered by Netflix, Inc. (NASDAQ:NFLX). The expansion would cost $4billion - $5billion. “It’s absolutely expensive, but they addressed this in their earnings call, when they had their call last quarter, so I look at it and say, this is just another page out of the Netflix playbook, if you will,” David Seaburg, head of sales trading at Cowen & Co., said on CNBC’s “Power Lunch,” on Friday.
When Seaburg discussed original content-streaming space, he said there is “plenty room for multiple players in that. It’s not a zero-sum game.”
Although many investors have lost confidence in tech giants postelection, Facebook, Inc. (NASDAQ:FB) and Amazon seem to be making a comeback. With Facebook’s recent stock buyback announcement and Amazon’s expansion of Amazon Prime Video, both companies seem to be back on track.
“So people who own the stock need to be patient that this could, in the near team, impact margins the way margins were hurt in the third quarter,” DiClemente said. DiCleme has a buy rating and $950 price target on Amazon.