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How much could Wal-Mart hurt Amazon?

|Includes:Amazon.com, Inc. (AMZN), WMT
Recent articles in The Atlantic and WSJ have highlighted Wal-Mart's new aggressive pricing scheme when it comes to popular book titles sold online through walmart.com.  The company has garnered attention by offering the top selling and top pre-selling books for prices around $10, significantly lower than some prices listed on Amazon's website.  Amazon has responded in some cases with lower pricing leading to speculations of a widening and long-term price war within the book industry.

Wal-Mart is well positioned to threaten Amazon by combining attractive pricing with quick delivery or an in-store pick-up option at Wal-Mart locations.  Wal-Mart already has distribution centers across the US that supply Wal-Mart stores and the retailer can leverage its widespread presence to offer quick delivery of items ordered through walmart.com. 

Books, DVDs & Music constitute about 41% of the $85.77 Trefis price for Amazon.  The company has about 31% share within the online market for books, DVDs and music within the US.  Within Amazon's content on our platform, you can see how the company's stock would be impacted if Amazon Share of US Online Books, DVDs & Music Sales were to stagnate or decline as a result of increasing competition from Wal-Mart.

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Stocks: AMZN, WMT