Why Amazon.com stock just popped

Amazon proposes a partnership with the U.S. government.

| More on:
amazon.com stock represented by man holding parcel printed with amazon logo

Image source: Amazon.com

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

In a late-breaking development, GeekWire just reported that Amazon.com Inc (NASDAQ: AMZN) has delivered a letter to new US President Joe Biden offering "to assist you in reaching your goal of vaccinating 100 million Americans in the first 100 days of your administration."  

By 3 p.m. EST, Amazon.com stock had jumped 4.9% in response.

So what

In the letter, Amazon Worldwide Consumer CEO Dave Clark reminded the president that Amazon.com is "the nation's second largest employer" with "over 800,000 employees in the United States, most of whom are essential workers."

Clark advised that Amazon has already hired a licensed third-party healthcare provider to administer vaccines on-site at Amazon facilities, and is "prepared to move quickly" to immunize the employees "once vaccines are available." Amazon also says, though, that it is "prepared to leverage our operations, information technology, and communications capabilities and expertise to assist your administration's vaccination efforts."

Now what

Clark did not specifically state in his letter that he wants to use Amazon's facilities, its workforce, or its relationship with the unnamed healthcare provider to administer vaccines to the populace in general, or to help distribute the vaccine to other locales -- although this seems to be implied, and may be something he would offer if the president follows up on his invitation.

At the very least, Amazon seems to be promising to help the new administration get off to a good first start with as many as 800,000 willing vaccine recipients. In so doing, Amazon could lower its own worker safety costs by reducing the incidence of COVID-19 at its stores and warehouses, where more than 19,000 workers have already tested positive over the course of the pandemic.

And if the president takes Amazon up on its implied promise to take an active role in rolling out vaccines across the nation? That could mean contracts and government money for Amazon, which would be an even bigger boon for the stock.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Rich Smith has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on International Stock News

A man looking at his laptop and thinking.
International Stock News

Why Alphabet stock was sliding today

Let's take a look.

Read more »

A man looking at his laptop and thinking.
International Stock News

Nvidia's stock was down despite its amazing earnings. Here's what history says is coming next

Although it might seem to defy logic, it's not an uncommon phenomenon.

Read more »

A woman holds a soldering tool as she sits in front of a computer screen while working on the manufacturing of technology equipment in a laboratory environment.
International Stock News

Nvidia share price slips despite 94% revenue growth

Q3 earnings beat expectations, but what about guidance?

Read more »

high, climbing, record high
International Stock News

Could the S&P 500 Index hit 6,500 by the end of 2025?

Could the index climb higher?

Read more »

a small child holds his chin with his head on the side in a serious thinking pose against a background of graphic question marks and a yellow lightbulb.
International Stock News

Is it too late to buy Nvidia shares?

Is Nvidia stock a buy ahead of its third-quarter earnings report tomorrow?

Read more »

a group of people stand examining a large glowing cystral ball held in the hands of one of the group members while the others regard it with various expressions of wonder, curiousity and scepticism.
International Stock News

Here's what to expect from Nvidia on November 20

Can Nvidia score another win?

Read more »

Two people lazing in deck chairs on a beautiful sandy beach through their hands up in the air.
International Stock News

2 no-brainer Warren Buffett stocks to buy right now

While replicating Buffett's success isn't possible, there are a handful of his investments that are no-brainer buys.

Read more »

A man with a beard and wearing dark sunglasses and a beanie head covering raises a fist in happy celebration as he sits at is computer in a home environment.
International Stock News

3 reasons to buy Nvidia stock before November 20

This week marks a big moment for tech investors as perhaps the most anticipated earnings of the year will be…

Read more »