I leave the country for a week and come back to find this board has gone NUTS!! Let's get back to AMZN. They lost $9 million.Analyst estimates for 1998 are more of the same. Stock has equity of $28 miilion so this time next year, with continued losses the equity in this company will be ZERO!!!! If anyone on this board has any UNEMOTIONAL judgement left, that means one/two things:
AMZN has got to SELL equity in a big way AMZN stock price is going down like a rock, (or both)
I agree with the analysis that if AMZN sales peak out at 400 mil that the stock price and the company will be in big trouble. If the company continues to grow at lets say 100 percent a year ( they grew 800 percent last year) for 3 years , they will be over a billion in sales. I think with their higher gross profits, non cash charges due to their intense capital outlays now, new business ventures ( music and videos) that they can do just fine.
There is most certainly room for 3 major internet sellers. The thing no one talks about is how BKS will get hurt as their high overhead retail stores slow down due to greater use of the net. No one seems to mention that AMZN is losing money due to high outlays now in facilities, agreements with yahoo, athome, aol, etc. A lot of companies lose money during their first five years. With AMZN it is recognized that they need to hit a billion in sales within 5 years to warrant these stock prices. it is most certainly possible that sales could grow to a billion five within five years as well. Why doesnt anyone recognize that the way AMZN does their selling is unique and it works. Remember when Home depot came out. Everyone said, they can all copy their methods, well the other retail stores couldnt copy Home Depot. isnt it possible that AMZN is in a similar situation. It is quite difficult to debate on these boards when there is coninued sarcasm without facts from Canstick and others. We also need to seperate the traders from the long term investors. Of course AMZN can trade in the 40 range in a second, as with any company this can happen and there is still nothing wrong with the company, just the way Mr. Market has decided to price the stock on an interim basis. As for now, I am holding the stock hoping to hit a grand slam and recognizing that i might strike out.
One more item, do any of you follow Cyprus Amax Minerals , symbol, CYM. I apologize for posting that here but am curious.
If you have 3 major sellers,AMZN won't get to a billion that fast...how do you limit it to 3 if there is so much money to be made?AMZN,to date,has not shown "greater gross margins"how can you assume that with increasing debt load and looking into the 3/5 year range as they max out the debt interest rates may be even greater pressuring the gross.Also,most of us are concerned with risk/reward ratio in making the investnent regardless of the "good company" argument.If you think it can go to 30/40 in a blink do you feel it can go to 80/90 likewise? Falling in love with a stock can deliver a cruel fate.