Amazon stock fell even more on Thursday morning after President Donald Trump expressed concerns over the tech giant, saying that the Seattle-based company pays “little or no taxes” to state and local governments and uses the U.S. Postal system “as their Delivery Boy.”
Amazon, which already shed four percent of its value yesterday, lost nearly two percent of its value in Thursday morning trading. The stock is now trading at about $1,400 down from about $1,539 when it started the week. Its market value stands at $678 billion.
Seeing an opportunity to pile on a news story that Axios broke yesterday about Trump being obsessed with regulating Amazon, the 45th President sent a Tweet out to his followers saying:
I have stated my concerns with Amazon long before the Election. Unlike others, they pay little or no taxes to state & local governments, use our Postal System as their Delivery Boy (causing tremendous loss to the U.S.), and are putting many thousands of retailers out of business!
— Donald J. Trump (@realDonaldTrump) March 29, 2018
Interestingly, Trump isn’t the only politician taking direct aim at Amazon. In its hometown of Seattle, socialist city councilmember Kshama Sawant is pushing a proposal to tax Amazon and other big companies in order to boost affordable housing in the city.
“Is everybody facing this crisis?” Sawant asked at an event held this week in Seattle. “Who isn’t facing this crisis? Jeff Bezos is not facing this crisis. Jeff Bezos now owns $100 billion and he has the distinction of being the wealthiest man in the world.”
Some investment professionals are advising clients to use the dip to purchase stock of Amazon, since some have predicted the company will one day surpass $1 trillion in value. That likely won’t happen anytime soon if regulators step in and curb the company’s growth rate.
But in a note to investors, Deutsche Bank said anti-trust action is unlikely.
“The potential for harm from the President’s ire is far less of a risk, near term at least, than the risks that Cambridge Analytica has exposed around Facebook,” analyst Lloyd Walmsley told clients, according to CNBC. “The U.S. Department of Justice focuses on the impact on consumers, not the impact on competitors, when it evaluates antitrust issues. Given Amazon has been a positive force for competition and for consumers, it seems like it would be an unusual target.” He also noted that Amazon now charges sales tax to customers in 45 states that have a sales tax, and the company has located fulfillment centers in many of those locations in order to ship goods more quickly to consumers.
Amazon is currently in the process of picking a $5 billion secondary headquarters, narrowing its search to 20 sites across North America. Nineteen of those sites are in the U.S., including three in the Washington D.C. area.
But if President Trump continues to ratchet up the rhetoric, one location may start to appeal to Jeff Bezos: Toronto, Canada.