As if being one of the largest companies on Earth with a market capitalization of more than $450 billion and having revolutionized e-commerce and the way we buy stuff is not enough, Amazon (AMZN) is at it again. Amazon is taking over the world! Well, not so fast.

One thing we know about Jeff Bezos and Amazon is that they relish being the disruptor. The Amazon playbook pattern its competitors fear most is profit margin—Amazon is known for slashing prices and forcing its competitors to slash theirs in order to compete. One major announcement and two speculative events have shaken retail investors to their core and sent many scrambling to sell: The announced acquisition of Whole Foods (WFM), discussions of a “fashion-in-a-box” strategy, and Nike (NKE) selling direct-to-consumer through Amazon.

Amazon announced (6/16/17) the friendly purchase of Whole Foods for $13.5 billion and proceeded to offer neither a lot of details about its plans for the platform nor financial projections for the future. The purchase announcement and the speculation about its implications alone have destroyed more than $30 billion of market capitalization from a select group of grocers, retailers that sell groceries, and companies that supply them the food they sell, as you can see in the chart above.

All the while, Amazon’s market capitalization actually rose by more than $18 billion in just the two subsequent trading days (6/16 and 6/19)—more than the price it’s paying for Whole Foods! The impact from the speculations of Amazon offering a “fashion-in-a-box” product as well as Nike selling its goods direct-to-consumer through Amazon extended the stock price rout to a select group of clothing and sporting goods retailers.

Can Amazon actually destroy $30 billion in market capitalization before they have even sold a sneaker for Nike or a head of lettuce through Whole Foods? Well the stock market is in the discounting future cash flows business and the early money is clearly on Amazon winning. However, they don’t always win ‚ remember the FirePhone or Askville?

So let’s try and put some of this into perspective. Whole Foods has about 2% market share of the nation’s approximately $685 billion in annual sales of groceries, and the deal isn’t likely to close until the end of 2017 if everything goes well. The retail market for clothing and shoes in the U.S. alone in 2015 was more than $250 billion so the market is obviously huge. There is obviously a market opportunity for more than one player—although those players have to either have some competitive advantage (high quality, unique product, or customer experience), and be able to match Amazon for price and convenience, or both. We think these events have created some opportunities to buy a few quality companies that can compete in an increasingly Amazon-dominated world moving forward.

The TJX Companies (TJX)

TJX is the owner/operator of TJ Maxx, Marshalls and Home Goods in the US, Winners in Canada, T.K. Maxx in Europe, and its internet-only offering Sierra Trading Post. TJX does not have a big internet presence. But that has not prevented the company from posting higher sales and better margins for many years. Customers enjoy the “treasure hunt” experience the stores offer as they return frequently to look for the latest bargains and finds of brand label products at discount prices. We think these characteristics, its distinct customer experience and an excellent management team will allow TJX to compete with the likes of Amazon for years to come.

TJX raised its dividend 20% earlier this year and now yields 1.7% (as of 7/3/17). While its most recent quarter was a bit weaker than expected on same-store-sales at +1%, we think weather may have had an impact (it was unusually cool and wet in the Northeast this Spring where TJX has many of its stores). We believe TJX can also continue to benefit from widespread department and specialty store closings (more than 5,000 this year alone, according to Credit Suisse) as they are able to purchase cheap merchandise from them to sell in their stores; an opportunity that can continue to present itself even if Amazon grows its market share. Its European business has hit its stride and its upcoming furniture store concept could be a next leg of growth.

Lowe’s Companies (LOW)

Home improvement chain Lowe’s has a good balance of professional customers who need things that day, offers services like specific day and time delivery and installation, and items that are often difficult to ship. U.S. macro-economic trends including home sales, employment, wage growth, household formation and residential real estate construction are positives. Home improvement expenditures posted its highest April level in 17 years, and home construction had its best 3 month growth since 1942 — potential tailwinds to the story. We think LOW is a +15% EPS (earnings per share) grower selling at just 16x 2018 estimated earnings. It now yields 2.1% (as of 7/3/17) after raising its dividend 17% last month and has a history of double-digit dividend hikes.

In our Alpine Rising Dividend Fund (AADDX/AAADX), we look for companies like TJX and LOW that we believe have plenty of cash flow to support higher dividend payments in the future. A company’s ability to grow earnings and cash flow can allow it to increase its dividend without compromising its balance sheet and offer investors not only the potential for growth in earnings, but an opportunity for better “real return” for their income.

One thing for sure is that Amazon is not going away. And this is not the likely the last time we will be having this conversation.

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The views expressed are as of the date specified and are subject to change based on changes in market, economic and other conditions. These opinions are not intended to be a forecast of future events, a guarantee of future results or legal, tax or investment advice.

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Earnings Per Share is the portion of a company’s profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company’s profitability.

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Top Ten Holdings (As of 3/31/17): Apple, Inc., 2.53%; Microsoft Corp., 2.25%; Pfizer, Inc., 2.12%; Amgen, Inc., 1.87%; Johnson & Johnson, 1.87%; Citizens Financial Group, Inc., 1.79%; Comcast Corp.-Class A, 1.74%; JPMorgan Chase & Co., 1.73%; Exxon Mobil Corp., 1.70%; FedEx Corp., 1.62%. References to specific securities are not intended and should not be relied upon as the basis for anyone to buy, sell or hold any security.

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