With the acquisition of Whole Foods, Amazon.com, Inc.’s (NASDAQ:AMZN) is poised to take a bite out of the $600 billion U.S. grocery market. Analyst Kip Paulson of Cantor believes the e-commerce giant is laying the groundwork to capture significant market share going forward. Hence, Paulson is shaking up revenue estimates and sees ample opportunity for Amazon to compete with other major players including Wal-Mart.

The analyst reiterates an Overweight rating on AMZN with a $1,150 price target representing a 17% rise from where the shares last closed. (To watch Paulson’s track record, click here)

Taking into account AMZN’s initial, major price reductions of 10-30% on best-selling items, the analyst is revising both revenue estimates for 2017 and 2018 and modeling for 6% growth. Paulson is estimating 2017 revenue to rise from $167.6 billion to $174.0 billion, EBITDA to reduce from $18.2 billion to $18.1 billion, EBIT to fall from $3.5 billion to $3.3 billion and GAAP EPS to drop from $4.14 to $3.43. Looking towards 2018, the analyst has adjusted revenue from $204.6 billion to $221.9 billion, EBITDA from $25.4 billion to $24.9 billion, EBIT from $8.0 billion to $7.4 billion and GAAP EPS from $9.46 to $7.95.

The revenue modification is based on Paulson’s understanding that “Amazon is intensely focused on the long-term opportunity and is more than willing to sacrifice today’s profit dollars for market share gains and longer-term profits.”  Moreover, the analyst opines, “Amazon’s willingness to re-invest every NT profit dollar for the long term could drive significantly higher market share gains […] Assuming a ~$600B U.S. grocery opportunity, we’re assuming Whole Foods market share will rise from ~2.6% today to 3.3% by 2022, which could still prove conservative.”

As the company continues to fire on all cylinders, Paulson remains positive on Amazon, condensing his bullish case into four key points: “1) leadership position and widening moat in e-commerce, 2) rapidly growing cloud computing business, 3) intense focus on the consumer and value proposition, and 4) compelling valuation vs. growth.”

TipRanks analytics exhibit AMZN as a Strong Buy. Out of 33 analysts polled by TipRanks in the last 3 months, 31 are bullish, while 2 are sidelined on Amazon stock. With a potential upside of 19%, the stock’s consensus target price stands at $1,169.11.