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Anemic Amazon: Wall Street Tires Of Jeff Bezos' Aversion To Profit
Posted on 4/25/14 at 1:38 pm
Posted on 4/25/14 at 1:38 pm
quote:
Amazon.com AMZN -8.7% continues to be a sales machine, but when is it going to turn real profits?
In what initially seemed like a gangbuster first quarter earnings report, Amazon showed nearly $20 billion in revenue, beating the analyst consensus estimate as sales rose 23% from last year. The company also eked out a small net income improvement — to $108 million from $82 million.
But Amazon’s guidance scared investors. While net sales are expected to grow between 15% and 26% compared to 2013, Amazon admitted they expect a return to the red — with an estimated operating loss between $455 million and 55 million. In last year’s second quarter, the company posted a small $79 million operating income.
Amazon has long traded at a massive multiple of its near-nonexistent earnings, but Wall Street appears to be getting tired of billionaire founder and CEO Jeff Bezos’ aversion to profits. Analysts everywhere lowered their price estimates for Amazon on Friday, including Bank of America-Merrill Lynch, J.P. Morgan, RBC, Deutsche Bank, Wells Fargo, SunTrust, and Citi.
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AMZN down -32.11 (-9.52%) so far today. What is a good target to jump into the stock?
Posted on 4/25/14 at 2:07 pm to saintforlife1
Posted on 4/25/14 at 2:40 pm to saintforlife1
At least they understand that it is an aversion to profits, and not an inability to make a profit.
If you believe in Bezos and the way he is running Amazon, then almost any price is a good price because you will be holding for life. As long as the growth rate is astronomical (20%+ for a company with revenue approaching 100B? That's insane.), why on earth would Amazon even think about slowing down on the investments? Why would anyone invest in a company, but not want that company to invest in itself and its future? Amazon has tons of room for growth, and if investors want to see Amazon turning big profits and paying dividends, then I think they will be disappointed for a couple more decades. I think those who hold for life will be very handsomely rewarded.
quote:
What is a good target to jump into the stock?
If you believe in Bezos and the way he is running Amazon, then almost any price is a good price because you will be holding for life. As long as the growth rate is astronomical (20%+ for a company with revenue approaching 100B? That's insane.), why on earth would Amazon even think about slowing down on the investments? Why would anyone invest in a company, but not want that company to invest in itself and its future? Amazon has tons of room for growth, and if investors want to see Amazon turning big profits and paying dividends, then I think they will be disappointed for a couple more decades. I think those who hold for life will be very handsomely rewarded.
Posted on 4/25/14 at 6:45 pm to saintforlife1
quote:
AMZN down -32.11 (-9.52%) so far today.
Sounds like they need a good stock split to make it more "accessible" to idiotic investors.
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