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  • daveeppy daveeppy Dec 7, 1997 10:16 AM Flag

    Short Sale

    Tell me more - what do you like about b&n - how can they levearage the two (physical and on-line?)

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    • Hi, I found this article from Bloomberg on SI and copied here for you to read:



      Seattle, Dec. 5 (Bloomberg) -- Amazon.com Inc., the online
      book retailer that calls itself the Earth's Biggest Bookstore,
      shows that the word ''Internet'' works wonders.

      Named after the Amazon River, the Seattle-based company
      expects millions of consumers to scan its online catalog of 2.5
      million titles and make purchases from home with the click of a
      computer mouse. That's why Amazon's stock was one of the hottest
      initial public offerings of the year, rising threefold since May.

      Investors who see nowhere for the stock to go but up may
      want to think again. There's scant evidence that droves of people
      want to buy books online -- and if they do, money-losing Amazon
      may not be the service they use.
      ''Most people won't give up on bookstores,'' said Giovanni
      Zocche, a software consultant at Bora Ventures.

      What's more, if online book buying takes off, Amazon's
      advantage of being first could quickly disappear as bigger,
      better-financed book retailers muscle their way into Internet
      selling.

      Barnes & Noble Inc. is beefing up its online site, which
      opened in May, and Borders Group Inc. plans to open its site for
      business in January. The two retailers lead the $25 billion U.S.
      book-selling industry with their chains of supermarket-size
      stores.
      ''There's already a battle,'' said Hambrecht & Quist LLC
      analyst Genni Combes, who has a ''buy'' recommendation on Amazon.

      Not Shy

      While Amazon executives won't say when or if the company
      ever will make money, Barnes & Noble isn't shy about discussing
      its online service. The New York-based company expects sales of
      $100 million to $125 million in 1998 and turn a profit in 1999,
      said Chief Operating Officer Stephen Riggio.
      ''With Barnes & Noble's nameplate, they'll be able to gain
      at least as much market share as Amazon,'' said Blackford
      Securities analyst Jason Klein, who rates Barnes & Noble a
      ''buy.''

      There's no arguing with Amazon fans on one point: The stock
      is the equivalent of a bestseller. Since going public at $18 in
      May in a $54 million IPO, the shares have soared and recently
      trade at about 54. The stock closed at a high of 66 on Oct. 29.

      At recent prices, Amazon has a market value of about $1.29
      billion. Not bad for a company with $90 million in sales in the
      past four quarters. Compare that with Barnes & Noble, with a
      market value of $2.2 billion and sales of $2.71 billion -- and a
      profit to boot.

      Selling More, Losing More

      Started in 1994 by former Wall Street money manager Jeffrey
      Bezos, Amazon's plan is to boost sales rapidly, helping it cover
      fixed costs. Then, once sales are high enough, demand the same
      discounts its bigger rivals get from publishers.
      ''It's a scale business,'' said Amazon Chief Financial
      Officer Joy Covey.

      Yet, the company's losses are expected to widen as its sales
      increase, mainly because of high sales and marketing costs.
      Indeed, third-quarter sales shot to $37.9 million from $4.2
      million a year earlier, yet its loss more than tripled to $8.5
      million from $2.4 million.

      Oddly enough, Amazon has higher overhead costs than its
      rivals, which must pay for hundreds of stores, vast inventories
      and thousands of workers. Amazon has about 19 cents left from
      each $1 in sales, while Barnes & Noble holds onto about 35 cents
      and Borders keeps about 25.

      Story Telling

      Many investors aren't all that concerned with the numbers,
      said consultant Zocche.
      ''They get excited by the story,'' he said.

      • 5 Replies to valuehound
      • piece. It makes more sense than most any long
        post I've read lately. Bloomberg piece also doubts
        whether this type of commerce will ever become the "norm"
        which I doubt too. Doesn't sound like they think AMZN
        will do very well either. 37mil. in sales yet loses
        increase 3X to 8.5mil! And they don't have much
        competition yet either. These guys and this sector is going
        to have a very hard time making ANY money in the
        future.

      • Pay special attention to this part:

        <b>"At recent prices, Amazon has a market value of about $1.29
        billion. Not bad for a company with $90 million in sales in the
        past four quarters. Compare that with Barnes & Noble, with a
        market value of $2.2 billion and sales of $2.71 billion -- and a
        profit to boot."</b>


        Why would anyone buy Amazon , when Barnes and Noble generates 30 times as much in revenues and sells for just under twice the market cap of Amazon? BKS also has a PROFITABLE business, and AMZN is forecast to continue LOSING money into next year. I dont
        get it. Also, AMZN is limited to sales on the internet, and can only do business with people who own computers and have access to the internet. BKS and BGP can sell to both the internet user and the man on the street. Buying AMZN at these ridiculous valuations makes no sense whatsoever. When the hype dies down, so will the stock price, probably all the way back to the IPO of 18.

      • Read what they said 3 years ago!

        Subj:
        Bloomberg article
        By: valuehound
        Date: 12/7/97 8:37
        pm

        Hi, I found this article from Bloomberg on SI and
        copied here for you to read: Seattle, Dec. 5 (Bloomberg)
        -- Amazon.com Inc., the online book retailer that
        calls itself the Earth's Biggest Bookstore, shows that
        the word ''Internet'' works wonders. Named after the
        Amazon River, the Seattle-based company expects millions
        of consumers to scan its online catalog of 2.5
        million titles and make purchases from home with the
        click of a computer mouse. That's why Amazon's stock
        was one of the hottest initial public offerings of
        the year, rising threefold since May. Investors who
        see nowhere for the stock to go but up may want to
        think again. There's scant evidence that droves of
        people want to buy books online -- and if they do,
        money-losing Amazon may not be the service they use. ''Most
        people won't give up on bookstores,'' said Giovanni
        Zocche, a software consultant at Bora Ventures. What's
        more, if online book buying takes off, Amazon's
        advantage of being first could quickly disappear as bigger,
        better-financed book retailers muscle their way into Internet
        selling. Barnes & Noble Inc. is beefing up its online
        site, which opened in May, and Borders Group Inc. plans
        to open its site for business in January. The two
        retailers lead the $25 billion U.S. book-selling industry
        with their chains of supermarket-size stores.
        ''There's already a battle,'' said Hambrecht & Quist LLC
        analyst Genni Combes, who has a ''buy'' recommendation on
        Amazon. Not Shy While Amazon executives won't say when or
        if the company ever will make money, Barnes & Noble
        isn't shy about discussing its online service. The New
        York-based company expects sales of $100 million to $125
        million in 1998 and turn a profit in 1999, said Chief
        Operating Officer Stephen Riggio. ''With Barnes & Noble's
        nameplate, they'll be able to gain at least as much market
        share as Amazon,'' said Blackford Securities analyst
        Jason Klein, who rates Barnes & Noble a ''buy.''
        There's no arguing with Amazon fans on one point: The
        stock is the equivalent of a bestseller. Since going
        public at $18 in May in a $54 million IPO, the shares
        have soared and recently trade at about 54. The stock
        closed at a high of 66 on Oct. 29. At recent prices,
        Amazon has a market value of about $1.29 billion. Not
        bad for a company with $90 million in sales in the
        past four quarters. Compare that with Barnes & Noble,
        with a market value of $2.2 billion and sales of $2.71
        billion -- and a profit to boot. Selling More, Losing
        More Started in 1994 by former Wall Street money
        manager Jeffrey Bezos, Amazon's plan is to boost sales
        rapidly, helping it cover fixed costs. Then, once sales
        are high enough, demand the same discounts its bigger
        rivals get from publishers. ''It's a scale business,''
        said Amazon Chief Financial Officer Joy Covey. Yet,
        the company's losses are expected to widen as its
        sales increase, mainly because of high sales and
        marketing costs. Indeed, third-quarter sales shot to $37.9
        million from $4.2 million a year earlier, yet its loss
        more than tripled to $8.5 million from $2.4 million.
        Oddly enough, Amazon has higher overhead costs than its
        rivals, which must pay for hundreds of stores, vast
        inventories and thousands of workers. Amazon has about 19
        cents left from each $1 in sales, while Barnes & Noble
        holds onto about 35 cents and Borders keeps about 25.
        Story Telling Many investors aren't all that concerned
        with the numbers, said consultant Zocche. ''They get
        excited by the story,'' he said.

      • Bloomberg on SI and copied here for you to read: Seattle, (Bloomberg) -- Amazon.com Inc., the online book retailer that calls itself the Earth's Biggest Bookstore, shows that the word ''Internet'' works wonders. Named after the Amazon River, the Seattle-based company expects millions of consumers to scan its online catalog of 2.5 million titles and make purchases from home with the click of a computer mouse. That's why Amazon's stock was one of the hottest initial public offerings of the year, rising threefold since May. Investors who see nowhere for the stock to go but up may want to think again. There's scant evidence that droves of people want to buy books online -- and if they do, money-losing Amazon may not be the service they use. ''Most people won't give up on bookstores,'' said Giovanni Zocche, a software consultant at Bora Ventures. What's more, if online book buying takes off, Amazon's advantage of being first could quickly disappear as bigger, better-financed book retailers muscle their way into Internet selling. Barnes & Noble Inc. is beefing up its online site, which opened in May, and Borders Group Inc. plans to open its site for business in January. The two retailers lead the $25 billion U.S. book-selling industry with their chains of supermarket-size stores. ''There's already a battle,'' said Hambrecht & Quist LLC analyst Genni Combes, who has a ''buy'' recommendation on Amazon. Not Shy While Amazon executives won't say when or if the company ever will make money, Barnes & Noble isn't shy about discussing its online service. The New York-based company expects sales of $100 million to $125 million in 1998 and turn a profit in 1999, said Chief Operating Officer Stephen Riggio. ''With Barnes & Noble's nameplate, they'll be able to gain at least as much market share as Amazon,'' said Blackford Securities analyst Jason Klein, who rates Barnes & Noble a ''buy.'' There's no arguing with Amazon fans on one point: The stock is the equivalent of a bestseller. Since going public at $18 in May in a $54 million IPO, the shares have soared and recently trade at about 54. The stock closed at a high of 66 on Oct. 29. At recent prices, Amazon has a market value of about $1.29 billion. Not bad for a company with $90 million in sales in the past four quarters. Compare that with Barnes & Noble, with a market value of $2.2 billion and sales of $2.71 billion -- and a profit to boot. Selling More, Losing More Started in 1994 by former Wall Street money manager Jeffrey Bezos, Amazon's plan is to boost sales rapidly, helping it cover fixed costs. Then, once sales are high enough, demand the same discounts its bigger rivals get from publishers. ''It's a scale business,'' said Amazon Chief Financial Officer Joy Covey. Yet, the company's losses are expected to widen as its sales increase, mainly because of high sales and marketing costs. Indeed, third-quarter sales shot to $37.9 million from $4.2 million a year earlier, yet its loss more than tripled to $8.5 million from $2.4 million. Oddly enough, Amazon has higher overhead costs than its rivals, which must pay for hundreds of stores, vast inventories and thousands of workers. Amazon has about 19 cents left from each $1 in sales, while Barnes & Noble holds onto about 35 cents and Borders keeps about 25. Story Telling Many investors aren't all that concerned with the numbers, said consultant Zocche. ''They get excited by the story,'' he said.

      • they said that investors are looking on AMZN more then on BKS B&N.com check it out

    • what goes up must come down!!!! bought puts today

 
AMZN
715.62+0.02(0.00%)Jun 30 4:00 PMEDT