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Amazon (AMZN) to Halt Activity in France After Court Ruling

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Reportedly, Amazon (AMZN - Free Report) stated that it will suspend all activities at distribution centers in France.

This could be a matter of concern for the people of the country during this pandemic as they are locked inside their houses and depend on these delivery services to fulfill needs.

The news comes on the heels of a court ruling that says that Amazon is not taking enough steps to protect its staff from the COVID-19 pandemic.

Reportedly, the court has banned the sale of non-essential goods from any of Amazon’s centers. The retail giant can now only deliver essentials like food, hygiene and medical products. Amazon needs to upgrade its health security procedures without any further delay, as it could be charged a hefty amount of one million euros ($1.1 million) per day as fine.

Amazon.com, Inc. Price and Consensus

 

Amazon’s Response on Workers’ Safety Measures

Amazon stated that it is continuously making efforts to ensure the welfare of workers amid the coronavirus-induced crisis.

These safety measures include temperature checks, physical distancing and use of personal protective equipment, among others.

Recently, Amazon also stated that it is looking to develop a diagnostic test for the detection of coronavirus among workers, for which it has already started collecting and assembling equipment that are required for the testing lab.

Moreover, it has dedicated a special team that comprises program managers, procurement specialists, research scientists and software engineers for this purpose.

Furthermore, the company has piloted disinfectant fogging at fulfillment centers, sortation centers and delivery stations.

In regard to workers’ safety, to date, the company has implemented more than 150 significant process changes across its sites worldwide.

All the above-mentioned measures should help it in mitigating the risk of spreading COVID-19 among its workforce.

Challenges

Over the past few weeks, Amazon has been facing unprecedented challenges in coping with the fallout from COVID-19. It is witnessing a flurry of online orders owing to mandatory self isolation as a result of this pandemic.

The company is facing hurdles in delivering packages on time. The spreading COVID-19 infection among workers has also become a big challenge now.

It has been facing workers strike at its warehouses, demanding for better pay and safer working conditions. The pressure to upgrade its health security plans has now increased significantly across fulfillment centers.

Notably, around 64 workers across the company’s warehouses and shipping facilities have been tested positive.

These court warnings and continuous strikes by workers could impact its sales to some extent. Also, such allegations do not bode well for an online retailer like Amazon, which has a well-known image and gives the assurance of fast delivery.

Nevertheless, the company’s growing initiatives to ensure the safety of workers remain noteworthy. Further, safe workers at its warehouses will help Amazon in meeting increasing customer demand during this panic-shopping scenario.

Zacks Rank & Stocks to Consider

Amazon currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Stamps.com Inc. , Fiverr International Lt. (FVRR - Free Report) and eBay Inc. (EBAY - Free Report) . While Stamps.com and Fiverr International sport a Zacks Rank #1 (Strong Buy), eBay carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Stamps.com, eBay and Fiverr International is currently projected at 15%, 11.6% and 44.2%, respectively.

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