OK, so granted going into Christmas is probably a bad time to buy some puts, this could easily go to $270, and sales may indeed go way up, but with little to no profit margin??? I think the markets crack at some point in the next couple of months due to political issues like the Fiscal Cliff, the Debt Ceiling, and a possible rating agency downgrade of the USA AAA rating... With a P/E as high as this one I would think the large traders will have pretty tight stops so if a selloff does happen AMZN could get hammered. Any thoughts on this, am I totally nuts and tossing money out the window?
I would have to agree with you although I would wait to make a move until after next quarter earnings release which I predict they will release stronger than expected on-line sales, which the bulls for this stock love. Shipping costs will increase like they have been which will further stress margins. The Kindle is a waste of time and has no business being grouped with the IPad or even the Surface as far as I am concerned not to mention their margin is terrible on it. They are expanding faster than they can support and are not sure if it will pay off due to rising costs. 2013 will only bring more tax lawsuits like the ones in France and Arizona currently being hashed out. Amazon Prime has excellent competition from Hulu, Netflix, and potentially Disney (Disney is my prediction, but they would be stupid not to with as much content that they have, not to mention live feed of all sports) next year. Next year they will also begin to feel the competition in on-line sales from names like Wal-Mart, potentially Facebook, and other retailers. All signs point to this being the next Netflix but worse! Expectations are way to high for this stock given the factors testing its dominance. If I was a hedge fund manager my thoughts would be that unloading leading up to the holidays due to rising price and consumer expectations would be a perfect exit strategy. Expect the decline to be in the spring of next year.
it's higher than ever and so is the stock: and people shorted it when it was a 100 and a 50 PE. in other words, shorting on the PE has been downright stupid. It's a trading stock here with good seasonal hype behind it.
Yes, the front running computers can easily control this high beta, low liquidity stock. Very few shares are traded as most are held by institutions and they will hold as long as retail stock pickers continue driving this up. Amazon has strong brand recongnition among less experienced retail "investors", so there is demand well above what fundamentals would ever suggest.