$126.20
5.59 (+4.63%)
Amazon.com, Inc. (AMZN)
CAPS Rating:
The Company operates retail websites and offers programs that enable third parties to sell products on its websites. It also operates other websites that enable search and navigation and a movie database.
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Bloated pig that is directly tied to consumer spending and has been falsely labeled by wall street.
Network computing and the Kindle are not going to morph amzn into a company that can support the current valuation.
This is a dying company. I shorted higher (over $50) and closed it out and re-shorted this around $40. Its worth every penny of $15.00.
Not sure if it can hold onto the air between current price and fair value for very long.
Is the P/E high? Yes. Has the stock price had a signifcant run up recently? Yes again. This however, is one company that I believe deserves its current valuation. Without question the best managed internet company of the twenty first century in the perfect spot during this economic recession, Amazon will profit from the downfall of what will be, without question, a very significant number of retailers. The Kindle allready represents over 10% of Amazons book sales, a truly inredible number when you consider it has only existed for two years. That is a number that I believe is only going to skyrocket, causing the most voracious consumers of the written word to buy ALL their books from Amazon. An incredibly efficient monster of a company, that I believe is, and will continue to be the premier internet company over the long term. Do I wish you could pick it up cheaper right now? Sure. But you dont get the best without paying a little more.
Saying AMZN is tied to consumer spending is a bit foolish (lower-case F).Consumer spending has dropped, but AMZN revenues have increased.The bears are wrong about the relationship. The fact is that Internet retail is going to continue to grow and AMZN is the established, profitable powerhouse.
Are you still holding the short at $40? It seems to be on quite a roll... everything seems to be getting great press - Kindle, Cloud, Shopper's experience - what will slow AMZN down?
I think Amazon is a great company, but I'm reluctant at these prices. A 50 PE and a PEG of 2 is way too high in this market; there are lots of really high quality companies available with PEGs of less than one and better projected growth rates.
I love the company, management and products. However, I would have to see prices at less than $35 to consider buying (and not $75 as I write this).
'Dying' and a 'bloated pig'? Seems like much too strong language for me.
If there's some bomb hidden in the cash flow statements that we haven't seen, let me know. Otherwise I don't see it.
AMZN is an incredibly efficient machine. It is, as you say, tied to consumer spending--but much of this spending represents the future. Video and music downloads, consumer products (not just books and e-toys) are at the heart of AMZN's business.
Another piece of this puzzle you might consider: AMZN's vendors. They are ever-more integrated into AMZN's daily operations. This means more money for AMZN (through residuals, or whatever agreement they have in sharing revenue), extra customer-store 'stickiness' and now, seamless order fulfilment.
That's my two cents--I'd give them another look.