Amazon.com, Inc. (NASDAQ:AMZN) could be the number one enemy of a Donald Trump White House. If Donald Trump becomes U.S. President and creates an “enemies list” similar to some of his predecessors, Jeff Bezos and Amazon could enter that list. But will such an entry hurt its stock price?
Will Amazon.com, Inc. Become an Enemy to a Trump White House?
When Richard Nixon was president, he had an informally named Nixon’s Enemies List. It was meant to be a list of political opponents who could be harmed. Some of the ways included an IRS audit, legal manipulation, lack of grants and so on. Names on the list included Paul Newman, Arnold Picker, Ron Dellums and John Conyers.
It was later discovered that a President Obama aide maintains an enemies list, too. Valerie Jarrett, a close adviser to the U.S. President, reportedly has an enemies list of people who may have questioned Obama.
Should Trump defeat Hillary Clinton in November, will the same thing happen? Well, if Trump does start a list then Amazon and Jeff Bezos could be first on that list.
Last month, Bezos, who owns the Washington Post, assigned 20 reporters to dive deep into the backgrounds of the remaining presidential candidates. Bezos said that by doing this the voter would not zero excuse not to vote coming Election.
Trump is on the list. The billionaire real estate mogul claimed that 20 reporters are hounding him and his staff every single day. He then accused Bezos of buying the newspaper as a “tool for political power.” Trump also alleged the newspaper is meant to be a tax dodge for Bezos.
The GOP nominee claimed the tech titan is “getting away with murder, tax-wise.” He also said a Trump White House would go after Amazon for anti-trust violations.
“He’s worried about me. He’s got a huge antitrust problem because he’s controlling so much,” said Trump. “Amazon is controlling so much of what they’re doing. And what they’ve done is he bought this paper for practically nothing, and he’s using that as a tool for political power against me and against other people, and I’ll tell you what, we can’t let him get away with it.”
Bezos wasn’t affected by the remarks. He just shrugged them off, making a crack about John Miller, the fake Trump spokesperson.
“That’s not an appropriate way for a presidential candidate to behave,” Bezos said.
“If you write a story and make sure people know about John Miller, it’s still the citizens’ decisions how to weigh that. They may decide it’s fine to pretend that you’re your own publicist. And if they do, that’s fine. It really is. That’s not our job.”
Bezos also said that he’s OK with Amazon being examined and scrutinized.
What About Amazon.com, Inc.’s Stock in a Trump World?
First, a Trump White House could spell bad news for Amazon investors. If Amazon does become an enemy to President Trump, experts are worried it could negatively affect its share price.
With anti-trust allegations and a determined Trump, Amazon’s legal team may be in for a fight. The tech firm does have several defenses already in place should Trump go after the website. However, as U.S. politics have shown in the past, things always change and are replaced.
MarketWatch‘s Nigam Arora notes that Amazon is in a vulnerable position right now.
“If Trump becomes president, there are significant risks to Amazon,” the column states. “Such risks are not discounted in the price of this stock at this time. In other words, investors right now are not being compensated for Trump risk.”
The column notes that the stock is very expensive right now, and investors aren’t being compensated for a Trump risk. It also cites that Amazon stock is overbought and analysts are overly bullish. Also, “old-line retailers” aren’t as struggling as Amazon investors think.
It’s recommended that a small amount of shares should be bought when a pullback happens.
Ultimately, if Trump becomes president, Amazon could have a very interesting four years.
Year-to-date, Amazon shares are up 5.3 percent at around $712.