[paulcole]

If someone is paying less than Amazon, they can easily undercut. Additionally, what if they'd been selling the product and then Amazon comes along and wins the buy box. A 3p seller might be willing to take a loss to just sell out remaining product to reinvest in a new item that Amazon isn't selling yet. There are a few other situations I can think of too where someone would undercut Amazon, even if it meant losing money.

There's really no way to understand someone's business model by only looking at their price.