Amazon.com, Inc. (NASDAQ:AMZN) will hold a press conference today to announce its new hardware-based streaming services, supplementing the Amazon Prime Instant Video service that already exists, but requires users to either watch through the Amazon Prime website or an Amazon device (eg Kindle Fire).

Amazon

20 million Prime subscribers give Amazon an opening

“We are interested to find out how Amazon will convince consumers to use an Amazon streaming service and how exactly it will be tied to Amazon’s core e-commerce business,” write Stifel analysts Jordan Rohan and Michael Purcell in a research note from April 2nd, 2014. “But with over 20mn Prime households, Amazon has the potential to shift the market.”

Rohan and Purcell aren’t convinced that Amazon.com, Inc. (NASDAQ:AMZN)’s entry to hardware-based streaming will have an immediate impact on a market that already has some established brands (Roku, Apple TV, to name a few), but it could provide some upside to what they argue is already an attractive stock and one of the best names in eCommerce. It’s not just the current 20 million Prime subscribers that could be interested, but millions more who use the site for purchases and will see the new service advertised every time they sign in.

Finding an entry point before the second half

Amazon.com, Inc. (NASDAQ:AMZN) stocks have fallen hard this year, hovering above $400 for most of January, the price fell below $350 as the market pulled back in February, then Amazon dropped off again during a recent tech sector pullback, leaving it below $340. While some of the stocks that fell along with it seem like pure froth (Twitter, Groupon), Amazon is one of the stalwarts of the tech sector and it could likely drive profits into the billions if it were willing to sacrifice growth, so the current price could be an entry point for investors looking to increase exposure to eCommerce.

Rohan and Purcell are bullish on Amazon.com, Inc. (NASDAQ:AMZN). They give it a Buy rating with a $440 price target and note that Amazon stocks follow the sales cycle, trending lower during the summer and then increasing more rapidly in the second half as back-to-school and then holiday sales make its number look better.

Assuming they are right on both points – that Amazon.com, Inc. (NASDAQ:AMZN) stocks dip in the summer and that the new streaming service won’t have a significant short-term impact – the cheapest entry point may still be a few months out, but interested investors should keep an eye on Amazon.com, Inc. (NASDAQ:AMZN) to get the most out of its expected second-half outperformance.