Amazon: Will It Benefit From Circuit City's Demise?

J.P. Morgan’s Imran Khan theorized in a research note this afternoon that Amazon.com (AMZN) could eventually be a beneficiary of the demise of Circuit City (CC), which earlier today said it would close all of its remaining stores and liquidate.

In the short run, it’s not likely to help, as the inventory from the company’s 567 remaining stores is sold off in a giant going-out-of-business sale that could pressure pricing in the already soft consumer electronics sector. But Khan also estimates that the company did $1.2 billion to $1.4 billion in online sales in its most recent fiscal year; he notes that, according to ComScore (SCOR), CircuitCity.com was the 11th largest Internet retailer by unique users through November. The company will stop operating the site as of Jan. 18, it said today. Khan thinks Amazon could inherit as much as half of Circuit City’s online business.

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