Amazon Restaurant Delivery Now in the District of Columbia

Zacks

Amazon.com, Inc. AMZN recently expanded its restaurant food delivery service in the greater Washington, D.C. area. The service is exclusive to its Amazon Prime subscribers and free of cost.

As many as 150 popular food chains and restaurants such as Maketto, Ben’s Next Door, Hill Country Barbecue Market, Kapnos and b DC Penn Quarter will be covered by the service.

We note that this is an extension of the food delivery service Amazon Restaurants launched in 2015 in Seattle. Since then, the service has been widened to many U.S. cities.

Coming to the price performance, over the past one year, shares of Amazon outperformed the Zacks categorized Electronic Commerce industry. While the industry gained 39.53%, the stock returned 45.91%.

How it Works?

Amazon Prime subscribers need to go to the Prime Now app and select the postal code of their area. A list of participating restaurants is shown. Customers can then select the restaurant of their choice, browse through the menu and place an order. Additionally, the app enables users to track the delivery of their order in real time.

Customers can expect delivery at their doorstep within an hour or less.

Competitors

Many companies are trying to alter the face of the food delivery service in the same way that tech start-ups like Uber changed the taxi industry. In addition to GrubHub and Postmates, the online retail giant faces competition from Sprig, Munchery and Spoonrocket.

Companies like GrubHub and Postmates allow consumers to order meals through smartphone apps from a range of restaurants and have them delivered at their doorsteps.

All these companies are going after autonomous U.S. food joints, which garner about billions through takeouts each year.

Going Forward

The food delivery business has razor-thin profit margins and complicated logistics. However, considering Amazon’s own fleet of delivery trucks and vast experience in logistics and distribution, we believe it is well-equipped to compete with other mobile food delivery players, like GrubHub and Eat24.

Amazon.com, Inc. Price and Consensus

Amazon.com, Inc. Price and Consensus | Amazon.com, Inc. Quote

Zacks Rank & Key Picks

At present, Amazon carries a Zacks Rank #5 (Strong Sell). Stocks worth considering in the industry include Texas Instruments TXN, sporting a Zacks Rank #1 (Strong Buy) and Xcerra Corporation XCRA and Internap Corporation INAP, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Texas Instruments delivered a positive earnings surprise of 7.09%, on average, in the trailing four quarters.

Xcerra Corporation delivered a positive earnings surprise of 187.5%, on average, in the trailing four quarters.

Internap Corporation delivered a positive earnings surprise of 4.56%, on average, in the trailing four quarters.

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