Analyst Bullish on Amazon (AMZN) Grocery Market Share Capture

Amazon.com  (AMZN) is seeing positive market sentiment as strategic expansions in its grocery delivery services are expected to drive increased customer engagement and revenue growth, bolstering its position in the competitive e-commerce landscape.

The bullish analyst note followed Amazon's aggressive moves to capture a larger share of the grocery market and enhance its domestic logistics capabilities. A key driver is the expansion of its Same-Day Delivery service for fresh groceries to over 2,300 U.S. cities and towns.

This service offers Prime members free same-day delivery on orders exceeding $25, while non-Prime members can access the service for $12.99. The convenience of ordering perishable items such as produce, meat, and dairy alongside other products, delivered within hours, has significantly boosted customer activity.

Since its launch, perishable grocery sales have seen a remarkable 30-fold increase, with customers who include fresh groceries in their Same-Day Delivery orders shopping approximately twice as often as those who do not.

Supporting this expansion, Amazon has also been testing “Amazon Now,” an ultra-fast delivery service in select areas of Seattle and Philadelphia. This service aims to deliver household essentials and fresh groceries in about 30 minutes, utilizing strategically located, smaller fulfillment facilities. Reduced delivery fees start at $3.99 for Prime members and $13.99 for non-Prime members. This initiative underlines Amazon's commitment to meeting consumer demand for quick, impulse purchases and further solidifying its logistical advantage.

Analyst Comments Support The Move

TD Cowen reiterated a Buy rating on Amazon's stock, increasing the price target to $300 from $255. The analyst firm believes that faster delivery speeds drive higher conversion rates, reinforcing the Prime ecosystem. Prime customers ordering fresh groceries shop “twice as often” compared to those who don't order fresh, underscoring the significance of this trend.

The improved selection offered by perishable food services is expected to continue driving Amazon's overall growth in the broader grocery category. These strategic moves are viewed as reinforcing Amazon's competitive edge in the e-commerce and logistics landscape, potentially leading to greater market share and revenue growth in the future.

The other element of the firm's analysis highlights the acceleration in Amazon Web Services (AWS) revenue, which grew 20.2% year-over-year in the third quarter of 2025. Moreover, AWS boasts a substantial $200 billion backlog, representing 22% year-over-year growth. TD Cowen's positive outlook stems from the combined potential of AWS's robust growth and Amazon's strategic expansion in the grocery segment.