Amazon Partners with Bath & Body Works as Valuation Hits Decade Low
Bath & Body Works is partnering with Amazon to reach new customers, CEO Daniel Heaf said. Amazon trades at decade-low valuation while AWS cloud revenue growth and stronger e-commerce leverage support upside.
1. Bath & Body Works Partnership
Bath & Body Works CEO Daniel Heaf said the retailer is turning to Amazon to reach new customers as part of its turnaround. The deal gives the mall staple access to Amazon’s marketplace, logistics network and Prime membership base. This partnership is expected to boost Bath & Body Works online sales and widen its digital footprint.
2. Valuation at Decade Low
Amazon’s current price-to-earnings ratio and enterprise-value-to-EBIT multiples have fallen to levels not seen in over ten years. The stock trades below its five-year average P/E of about 45x and EV/EBIT near 20x, suggesting potential undervaluation. Investors point to historically low growth expectations as a catalyst for upside.
3. AWS Growth and E-commerce Leverage
AWS reported year-over-year revenue growth of roughly 25% last quarter, reflecting continued enterprise demand and pricing power in cloud services. E-commerce operations have seen margin improvement from fulfillment efficiency gains and economies of scale. Combined cloud and retail unit leverage are expected to drive stronger free cash flow moving forward.