NEW YORK (TheStreet) --Amazon.com's (AMZN) - Get Reportadvertising business is projected to garner around $1 billion in online ad revenue in the U.S. for 2017, according to eMarketer, a market research company.
RBC Capital Markets lead tech analyst Mark Mahaney appeared on Friday afternoon's "Closing Bell" on CNBC to discuss the e-commerce giant's push into furthering its advertising business.
"I think that's a good number, and we actually published that they were going to do about a billion in revenue this year. When Jeff Bezos put out his shareholder letter, he talked about his three pillars of growth and said that the company was busily exploring its fourth pillar of growth. We examined a bunch of different areas including these Alexa devices, but advertising was also one of them," Mahaney explained.
He added that Amazon's vast collection of commercial data could ultimately be utilized to target advertising.
"Our sense is through it's not as big a priority as some of the other areas, particularly artificial intelligence, and probably groceries. Those and business supplies are probably a higher priority, but it's a good add-on business for Amazon that will get bigger over time no question," he said.
Shares of Amazon.com closed lower on Friday.
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Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings team rates Amazon.com as a Buy with a ratings score of B-. This is driven by a few notable strengths, which the team believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks the team covers.
You can view the full analysis from the report here: AMZN