so earnings will increase exponentially? Let's hope so as the multiple has blown out the last year exponentially, so somewhere ahead the earings can catch up to the 650 multiple. But that's uncertain. Nevertheless, as usual on what was expected news anyway, traders are climibing over themeselves to buy AMZN today on this EXPECTED news. Enjoy the chase.
"they reported 20% sales increase -- yes, that is growth," that's growth at the expense of taking your earnings down 75 % from the peak to keep that incremental sales growth. That's why they had to tap the bond market in late 2012 and are heading toward there again ahead: Retained earnings has stagnated for years now: why is that despite the fact that most of the spending AMZN does can be captialzied, yet retained earnings stay stagnated. GAAP for AMZN mean growth at any price. And I'd argue the upgrades that come with AMZN by these analysts are now become so over the top Pavolivan, why even report numbers? And remember: AMZN competitiors in ALMOST EVERY DIRECTIONS HAVE HUGE CASH PILES built up in this bull market. That won't make it easy for AMZN to merely turn the Prime lever, or any other , to get sales to drop to the bottom line. Maybe some, but perhaps not even close to bring down the multiple run rate that AMZN runs at now. You''re a pump artist Bent. nothing more.
"A big driver of growth": driver of what growth? sales? earnings have fallen off 75 % in the last 4 years to drive incremental sales growth to the point where AMZN has to tap the bond market in order to operate and keep buying back shares to keep o/s share counts from exploding upwards. Consumers are fickle to price increases on where they will get their items and ther'e's no guarantee that upping Prime prices will make people stick to AMZN when the freedom of buying from anywhere exists. Bezos is tapping down his cash quickly to keep this house of cards near $400/shr together. Regardless, he has locked into the benefit of the doubt that WS has gvien him.
and forget all these analysts earnings targets: I'd like to see an analyst ask when AMZN is gonna get back to getting close to peak earnings of $2.52 alltime for 4 qtrs. They make 75 % less than that right now. It's not gonna be easy to even get there : which would give AMZN a 385/2.52 = 153 times peak alltime earnings right now. That's off the charts in itself.
not it's not: it's now lower: replacing 21 cents AMZN made in 4th qtr 2012 with 52 cents in 2013, give AMZN about 60 cents of earnings in 2013. So the PE at 385 price per share is now 638 times earnings. whatever happens ahead, Bezos has been a huge winner by locking into selling 15 million shares as WS has pumped AMZN to over $400, while disregarding the peak earings decline to gain sales. It will be interesting how much Bezos can turn the Prime screw pricing up and keep loyal customers to pay it. That's why choice for the consumer beyond one entity to buy from is a great thing to have.
items shipped as a measurement. How about sales #$%$ shipped at least. We know that profit dollars were abandoned long ago b/c there are none: but times shipped aren't even sales $'s: they meaure more than sales '$. You watch.
the masterful "letter" : items up , but won't come close to matching sales $'s. Too bad "items shipped" has been inversely correlated to profits.
you really think people will feel save on a road like the LIE just outside NYC in rush hour with self driving cars? Computers malfunction all the time: what kind of crackups will that cause? I don't see those self-drivings cars being adapted anytime soon and I hope they don't. I trust people to drive more than computers.
I say April 30,2014 a the latest.
"Instead it shows a glaring case of waste of company resources and mal investment in frivolous concepts rather than growing the company into profitability"
in the old normal, perhaps we'd get alittle more scrutiny to what's up with AMZN. Now there seems to be a cloudy line to what passes for investigative journalism. As it seemed to me, Charlie Rose was fawning over and promoting Bezos as a feudal lord. They are both in the Bildeberger soceity afterall and the concept fits with what this bull market has been of the 2008 housing debacle: a collusive step by Central Banks to have a wealth effect rally in stock espcially, no matter what the valuation it leads to ,passing wealth up the line to the Jeff Bezos and Charle Roses of the world, at the expense of the rest of Society. Profits be damned, it's all about pumping concepts to the end by the ones in power, FOR the ones in power. It's reached such utter nonsense proportions now.
example of one of the many big pocketed competitors of AMZN. Though one would never know it looking at AMZN's stock performance the last 5 years. Not that easy to snap a finger to get scale and drop it to the bottom line.
it's not AMZN's tax, it's AMZN's collection from the customer tax. Less revenue maybe but doesn't mean less profit as ,we know, AMZN has lost more to the bottom line to gain scale to the topline. So it doesn't necessarily work that way to the profit line.
it also depends on the price they are flushing the inventory out at, along with the cost to get the inventory out at. There's huge inventory this season in the Holidays. AMZN is great at flushing inventory out on deals, but it's on those deals, that take thier margins down where the top dollars are so reduced, that they don't reach the bottom line. Competition is fierce as ever. AMZN's gonna hit the bond market again going foward on the cash bleed ahead in my, and some others, view here. Hype aside.
"our belief that an earnings figure at a certain point in time should matter as much to others is the opposite of the truth. it simply does not."e
that's nonsense. Maybe under an easy money QE regime, but not when the insiders get paid before there's any retained equity. Then it's a glorified ponzi scheme.
Goldman is the gov't basically. Every Central Banks head QEing around the world is an ex-Goldman employee almost. And no Company has benefited more from QE than AMZN.
there's a simpler way to know what net income is for AMZN over it's lifetime: retained earnings: that's the next earnings of AMZN after dividends paid and we know it doesn't pay dividends. It's $4 billion, it's under $2 billion. There lies Bezos genius as he's worth about $50 billion with that 18 year condition. Another thing that's phenomenal into this parabolic is that AMZN traded at about 40 times earnings at the lows of 2008 at 35, and well over a 1000 after running 11 times that low there abouts. So , now to equate to that 40 multiple, AMZN would have to quadruple it's peak earnings ever. Obviously, they can't use a multiple justification with the stock running so high against that kind of measurement. And moving on a parabolic basis. Someone in powerful places ordained Bezos to be worth $50 billion without an earnings multiple. Phenomenal stuff.
"Why don't beezos concentrate on making a dollar profit then spending his time on stupid projects."
bigger question is the oppositie: why should if WS is gonna keep rewarding his loss leading strategy more than a company with built up retained equity? Doesn't make him ever have to and until he does, I don't think he will.
I speak the truth:tell where their peak earnings were greater than $2.52 /yr to this point? You can't. As i said, more power to Bezos to get this much belief without a consistent profit model. Don't change the subject.
obviously, they didn't have enough free cash flow to not have to hit the bond market last year for $3 billion. And it's gonna come again in my view ahead. Bob Olstein does not agree with you that AMZN is operating in a positive free cash flow postiion right now. I think tapping the bond market supports that assertion no matter what you say. Inventores are very high and comptition will be very highs this Holiday. AMZN sells alot of this deal stuff more than high margin stuff for them and they ship it away over cost when the overall operation is added up. People like buying stuff below cost and they provide that, especially for the $79 a year free shipper go into the black against AMZN quickly.
indeed , they made profits a ways back, the peak being $2.52/ over a 4 qtr period: that dwindled toward nothing the past three years to where a quadruple of peak profit ot $2.52, slaps almost 40 multiple on AMZN:in other words, expecatations have never been higher as shown by the parabolic move in the stock sinc the 279 lows of Auguest, yet to get quadrupling profits to it's peak, or even back to $2.52 is elusive at best. AMZN is a loss leader and WS digs that, I'll give you that. It has 20 multiple now to making $20/shr in year some year, decade, millenium going out. Meanwhile Bezos pocket is stufffed with locked in gains. Kudos to him that he has such belief by WS to get this situation that's in the parabolic zone.