Amazon
AMZN
is leaving no stone unturned to bolster its delivery infrastructure on the back of its long-awaited drone delivery service. Moreover, its growing efforts toward expanding the coverage area of its Prime Air drone delivery program across the United States remain positive.
Notably, the e-commerce giant is currently gearing up to launch its drone-delivery service in College Station, TX, later this year, which testifies the above-mentioned fact.
College Station will be the second location for Prime Air drone deliveries.
Recently, the company picked Lockeford, CA, as the first location for such deliveries.
With the drone delivery initiative, the company strives to offer a unique, quick and safe delivery experience to customers.
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More Into Details
We note that Amazon’s drones are programmed to drop customers’ parcels in their backyards to offer them a unique delivery experience.
Further, these drones have the capability of delivering packages weighing up to five pounds in less than an hour.
The drones, which can fly up to 50 miles per hour and up to an altitude of 400 feet, are designed and equipped to fly beyond line of sight. Also, the detection system of the drones aids in avoiding mid-air collisions.
The expansion of the Prime Air drone delivery program bodes well for Amazon’s growing efforts toward boosting its customer-oriented approach, which acts as a key catalyst in driving its customer momentum.
Delivery Drone Market Holds Promise
The growing proliferation of online shopping, driven by the increasing penetration of Internet and smartphone use, has led to the emergence of delivery drones, which are capable of making rapid parcel deliveries.
The demand for the particular drones is being aided by innovation in cargo transportation.
Per a report from MarketsandMarkets, the drone package delivery market is expected to hit $228 million in 2022 and is likely to witness a CAGR of 49% between 2022 and 2030 to reach $5.6 billion by 2030.
A report from Mordor Intelligence suggests that the global delivery drone market is expected to witness a CAGR of more than 12% between 2022 and 2027.
Amazon is expected to rapidly penetrate the booming market with the help of its innovative AI-powered delivery drones.
AI techniques help the drones navigate properly, reach their destination and drop off the packages by detecting telephone wires, people, animals and properties on the ground.
Moreover, the company’s deepening focus on this promising market and technology is likely to aid it in winning investors’ confidence in the near term. Notably, Amazon has lost 31.7% on a year-to-date basis.
Zacks Rank & Stocks to Consider
Currently, Amazon carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the retail-wholesale sector are
Group 1 Automotive
GPI
,
AutoNation
AN
and
The Kroger
KR
. All the three stocks currently carry a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Group 1 Automotive has lost 10.4% on a year-to-date basis. The long-term earnings growth rate for the GPI stock is currently projected at 14.19%.
AutoNation has gained 4.5% over a year. The long-term earnings growth rate for the AN stock is currently projected at 24.74%.
Kroger has gained 5.4% on a year-to-date basis. The long-term earnings growth rate for the KR stock is currently projected at 11.27%.
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