Can This New Device Help Barnes and Noble Challenge Amazon?

Barnes & Noble Inc. (NYSE:BKS) introduced their answer to Amazon’s (NASDAQ:AMZN) Kindle Fire and Apple’s (NASDAQ:AAPL) iPad. The new Nook has more memory and more speed, but consumers will pay a premium for the benefits as the tablet is $50 more than the Fire, yet cheaper than the iPad.

The Nook has 16 gigabytes of memory where the equivalent Kindle Fire has only 8. The Nook will be available in stores next week, approximately the same time that the Kindle Fire will begin shipping setting the scene for a holiday battle royal between the products. The Nook tends to appeal to consumers who are looking for a more simplistic e-reader as opposed to the tech heads that generally opt for the Kindle Fire and Apple (NASDAQ:AAPL) iPad.

Reuters quotes Barnes & Noble Inc. (NYSE:BKS) CEO William Lynch who said in the presentation of the Nook, “We are serving the core reader first.” He continued to tout the features of Nook and criticized the Kindle Fire for having “deficient” storage and being a “vending machine” for all of Amazon’s other non-reading related services. While Lynch says that the Nook is a superior product and therefore justifies its $249 price tag, some analysts aren’t so sure. NPD analyst Ross Rubin told Reuters, “The $50 price difference is significant. You’re talking about a 25 percent difference.”

Tapping into the e-reader market has been a saving grace for Barnes & Noble Inc. (NYSE:BKS). The retailer has seen sharp declines in book sales, but had success with the Nook. Even though they entered the market late, they have still managed captured 25% of the e-reader market.

Here’s how ebook stocks are trading:

  • Barnes & Noble, Inc. (NYSE:BKS): The shares recently traded at $12.03, up $0.64, or 5.62%. Its market capitalization is $696.74 million. They have traded in a 52-week range of $10.30 to $12.65. Volume today was 1,094,543 shares versus a 3-month average volume of 864,641 shares. The company’s trailing earnings are $-1.20 per share. The company pays a dividend of $1.00 per share for a dividend yield of 8.60%. About the company: Barnes & Noble, Inc. operates superstores and mall-based bookstores throughout the US. The Company operates book superstores under the names Barnes & Noble Booksellers, Bookstop, and Bookstar. Barnes & Noble also operates bookstores in shopping malls under the names B. Dalton Bookseller, Doubleday Book Shops, and Scribner’s Bookstore. Get the most recent company news and stock data here >>
  • Amazon.com Inc. (NASDAQ:AMZN): The shares recently traded at $217.99, up $0.99, or 0.46%. Its market capitalization is $99.13 billion. They have traded in a 52-week range of $156.77 to $246.71. Volume today was 3,873,543 shares versus a 3-month average volume of 6,903,720 shares. The company’s trailing P/E is 114.91, while trailing earnings are $1.90 per share. About the company: Amazon.com, Inc. is an online retailer that offers a wide range of products. The Company’s products include books, music, videotapes, computers, electronics, home and garden, and numerous other products. Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers. Get the most recent company news and stock data here >>
  • Apple Inc. (NASDAQ:AAPL): The shares recently traded at $406.23, up $6.5, or 1.63%. Its market capitalization is $377.50 billion. They have traded in a 52-week range of $297.76 to $426.70. Volume today was 14,167,233 shares versus a 3-month average volume of 21,469,300 shares. The company’s trailing P/E is 14.68, while trailing earnings are $27.68 per share. About the company: Apple Inc. designs, manufactures, and markets personal computers and related personal computing and mobile communication devices along with a variety of related software, services, peripherals, and networking solutions. The Company sells its products worldwide through its online stores, its retail stores, its direct sales force, third-party wholesalers, and resellers. Get the most recent company news and stock data here >>

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