DA Davidson analyst Tom Forte raised his 12-18 month price target on Amazon.com (NASDAQ: AMZN) to $1,500.00 (from $1,300.00) while maintaining a Buy rating.

Forte said while the company reported record holiday results, they are focused on the company's increased physical footprint as "THE story of its 2017 holiday sales and an indication of things to come in the future as Amazon increasingly leverages physical stores to increase its revenue growth and wallet share."

Forte highlights that management noted that its Echo Dot proprietary hardware was the best-selling device at its Whole Foods stores.

"Having closed the transaction in August we see 2017 as a beta test, its first step in an iterative process to increasingly leverage physical stores to increase its holiday sales. In the future, we believe, at the minimum it will roll out its Amazon Go proprietary technology to enable consumers to skip the checkout counter for the portion of Whole Foods stores where consumers can purchase prepared foods. Increasingly, consumers will be able to pick up online purchases and process returns at its Whole Foods locations. We expect it to devote an increasing amount of floor space to its proprietary hardware. Lastly, we expect it to leverage its Whole Foods locations with new efforts, such as an Amazon pharmacy."