For the past month Amazon Inc. (NASDAQ: AMZN) has been taking names as it has moved across multiple industries. The Whole Foods acquisition may have been the biggest story but the e-commerce giant has also wriggled its way into auto parts and food delivery, just to name a few.

Now the online retailer has its sights set on smart appliances. On Thursday, Amazon and struggling retailer Sears Holdings Corp. (NASDAQ: SHLD) struck up a deal to cross Amazon’s smart assistant Alexa with Sears’ full line of Kenmore Smart appliances. The announcement sent shock waves through the business community, but one analyst believes the reaction may be overdone.

Jefferies noted that in recent weeks that the firm has seen a series of knee-jerk reactions to anything Amazon does as instant fear and anxiety sets in. Jefferies doesn’t underestimate Amazon, because appliance transactions are complex and Kenmore brand equity has declined. But Jefferies does not believe this is an indicator that more appliance manufacturers will sell directly via Amazon.

Overall the brokerage firm believes the share weakness seen in Home Depot, Inc. (NYSE: HD), Lowe’s Companies, Inc. (NYSE: LOW), and Best Buy Co., Inc. (NYSE: BBY) has been an overreaction to Amazon.

On the news that Amazon planned to partner with Sears, shares of rivals Home Depot, Lowe’s and Best Buy all pulled back. Investors feared that more appliance manufacturers will eventually begin to sell directly through Amazon and bypass brick-and-mortar retailers, and Kenmore would benefit from greater near-term distribution. Jefferies pointed out:

“On the margin the increased distribution of Kenmore product is a small negative, but just because Kenmore is available at Amazon doesn’t mean customers are going to want this dying brand anymore than they do now, especially as news of Sears’ future grows more negative and the industry moves toward more smart appliances, hence giving customers more options beyond Alexa.”

Jefferies assessed if more manufacturers could go to Amazon:

“While we would never say never, appliance manufacturers have thus far chosen not to sell directly through Amazon and we think for very good reasons. First, the manufacturers value their relationship with the three largest national retailers selling their products and the floor displays and post-purchase service they provide such as delivery and installation. A big-ticket appliance purchase is a more complex purchase requiring see, touch, feel, and service, all of which we believe require a convenient brick and mortar presence and delivery capabilities. Second, the manufacturers would have to dedicate more resources to develop large online order fulfillment capabilities (in a unique situation, Sears will be distributing Kenmore for Amazon). Third, we believe that a customer would not see a sustainable price advantage on Amazon for appliances. Appliance retail is heavily tied to MAP policies, making it difficult for any player to consistently underprice another and compete only on price. It is hard to believe manufacturers would risk good relationships with their largest retail partners (who also happen to be among the healthiest in retail) by offering lower prices to Amazon.”

Amazon shares were recently seen at $1,023.49, down 0.5%, with a 52-week range of $710.10 to $1,034.97 and a consensus analyst price target of $1,129.06.

Shares of Sears were last seen at $9.11, down 5.1%. The stock has a consensus analyst price target of $4.00 and a 52-week range of $5.50 to $18.18.

Shares of Home Depot were last trading at $147.06, with a consensus analyst price target of $171.27 and a 52-week range of $119.20 to $160.86.

Shares of Lowe’s were last seen at $73.87, up 1,8%. The stock has a 52-week range of $64.87 to $86.25 and a consensus analyst price target of $88.85.

Shares of Best Buy were recently trading at $54.30, up 0.6%, with a 52-week range of $31.91 to $61.95 and a consensus analyst price target of $60.39

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