Of course, it isn’t Stamps.com on which Trump is focused when he complains about the Postal Service. Rather, it’s the supposed “last mile” subsidy the agency’s pricing gives to e-commerce behemoth Amazon (AMZN). A series of Tweets from Trump back in April sent AMZN stock down over 10% in just a few trading sessions. And there’s much than just a short-term risk here.
Amazon’s operating margins remain thin (as is the case for most retailers), at just 5% so far this year. Shipping costs, per the 10-Q, are over 10% of revenue. A notable increase in USPS rates could elevate that spend and hit Amazon’s margins enough to dent profitability.
Of course, that’s far from the only political risk Amazon faces. Minimum wage hikes could move labor costs higher, though Amazon already has raised pay. Calls for antitrust action, which admittedly would require a major change in the goals of antitrust law, are growing louder.
Its HQ2 process likely cost it goodwill with state and local authorities. Like most of “big tech”, Amazon is going to be a lightning rod for controversy for some time to come. And as seen in April, those controversies can have a big effect on the AMZN stock price.