Not if you compare its price to sales ratio with other companies .
AMZN PS ratio is only 2.34 compared to railroad companies such as Kansas City southern which has a PS ratio of 5.86 .or UNP at 3.25.
Or how about Netflix at 4.49 ?
All that AMZN has to do is increase its profit margins from a ridiculously low 0.19% and its profit could rocket higher . Disclosure I have no AMZN holding and no short position
AMZN is definitely a greater-fool play. The fundamentals don't seem to matter much. Amazon increases its sales by starting new businesses. Any business can do that. You can do that. In fact, you can do it until you are so deep in debt the bubble bursts. Amazon's bottom line, its net worth (net tangible assets) hasn't changed for years, so the price per book just keeps growing. Finally, what is the point of doing so much business if you never make a profit? Companies that don't make profits go down eventually.
"All that AMZN has to do is increase its profit margins from a ridiculously low 0.19% and its profit could rocket higher . "
It is that simple?? wow, they should do it right now if it is so simple.
Maybe you can help me out then. I know this short here who not only has no profit on his short but also has a $125 per share loss on it. how much is his short overvalued by then?
You can't compare transports to retailers. Secondly, if AMZN raises prices to increase margins, they will lose market share. This is why they keep buying their growth by trying to expand into a zillion different companies.
no AMZN is very very cheap here!!!
this is going to 1000 in 2-3 months
FED printing money policy
you never know what is the up side limit of bubble, but you know that bubble tend to blow up soon or latter
GL for longs which think that AMZN will make lot of money....
Analysts keep upgrading AMZN regardless its PE. OK let 's forget about PE now. Just talk about the its operating cash flow. It has around $5B positive cash flow in the last 12 months. Assume it does not do any investment, so, the max income is $5B for whole year, which is still not enough to support $160B market cap company. There are many companies with this market cap can make more than $10B profit even after spending on billions in investment.
Fee Cash flow is $389M over the past 12 months, not $5B (they had $5B in operating cash flow less $4.6B in capex .. thus ~ $0.4B in FCF) ... AMZN currently trades at 427x FCF. We don;t need to discuss P/E, just look at multiple of FCF. Highest in S&P500. I thought Jeff was all about Free Cash Flow??? Their not good at generating that either.