Dive Brief:

• Amazon is on pace to become one of the first-ever $1 trillion companies by the end of 2018, and its many high-margin business operations could push its stock to $2,000 per share, according to a note from Morgan Stanley described by Business Insider.

• Morgan Stanley analyst Brian Newark broke down Amazon into its various businesses, giving each a value on its own, with retail at $600 billion, Amazon Web Services at $270 billion, Prime subscriptions at $70 billion and advertising at $55 billion — for a total of $995 billion.

• By Newark’s measure, Amazon's retail business will see 13% annual sales growth, a 5.5% operating margin, and, for its marketplace alone, a 25% profit margin by 2022, according to the report. Its advertising business is formidable, with an estimated 22% compound annual growth rate by 2022, according to Newark.

Dive Insight:

Amazon’s business units are growing at various paces, but they’re providing the e-commerce giant with ample reserves to invest back into its operations — and its ambitions.

If there’s any implication that investors would see greater returns if some of those businesses were to be set free, it’s unlikely that Jeff Bezos would pay any heed, according to Howard Davidowitz, chairman of New York City-based retail consulting and investment banking firm Davidowitz & Associates Inc. That means that Amazon’s retail enterprise, widely seen as propped up by its more lucrative enterprises, like its AWS cloud services unit and its advertising operations, will continue to disrupt the industry.

"Jeff Bezos has never paid attention to Wall Street, and I don’t think he’s going to start now," Davidowtiz told Retail Dive in an interview. "The stock is undervalued, I agree, because we’re only in the second inning of the change that he is bringing."

In fact, it’s Wall Street that has had a change of heart when it comes to Amazon. "They murdered him, the same people said 'he’s not making any money,' and he ignored them for 10 years. I think what Jeff Bezos would do is take whatever steps he thinks would make the business better. He’s an American original like [Walmart founder] Sam Walton."

Davidowitz pointed to steps like the one last week when Amazon consolidated its food teams for more efficiencies as a demonstration of the company's agility. What that really means is that retailers that want to survive the landscape that Amazon is re-shaping must finds ways not to ape it, but to differentiate themselves, much like Target did when Walmart was disrupting the retail landscape decades ago.

"Target is the only discounter that survived because they found a way to differentiate themselves from Walmart," he said. "Target found a niche, and distinguished themselves by going the other way and did a great job for many years. If you’re going to fight Bezos — you’re never going to catch Bezos — so you have to do something different."