Here is the opportunity. Become a mega wholesaler, create infrastructure to maintain "business as a service / business on clouds". Each business is setup to sell 1M (tax threshold), come back in a year, sell another 1M...of course, a given owner could own 10s and 100s of those business entities :D
Nah...AMZN the stock will go down. AMZN simply cannot sustain the level of growth rate required to main its current valuation.
AMZN supports the sales tax because they don't want someone to come along and did what they did - destroy local economies through an unfair advantage. That said, AMZN still faces formidable and entrenched competitors with deep pockets. Do note that their competitors are profitable business with a razor sharp focus. Unlike AMZN, they don't chase every shiny new ball to mask losses an inability to compete on a level play field.
It would probably have been better if the tax did not pass. AMZN is expanding into all the states, so they would have had to pay sales tax anyway. If sales tax did not pass, AMZN would have faced a ton of online retailers doing what they did - undercut the competition through the sales tax advantage.
Either way though, AMZN is in for a rude awakening. Retailers with existing distribution foot print in place are getting better at managing their logistics - for example, fulfilling online orders using the inventory of the stores nearest you. Existing major and mega retailers will able to fulfill orders faster and with less cost than AMZN.
YHOO lists the following for AMZN. I see Dec 31, 2014 as fye for many other companies too. The question is why 2014? Why 1.5 year from now? Shouldn't be 12 months from "now" ?
Forward P/E (fye Dec 31, 2014)1: 76.07
Check out OPEN - a momentum stock that peaked at ~115 APR 2011 and bottomed out at ~32 NOV 2011.
Today, OPEN is still sub 60 , 1.5 years after it bottomed.
LNKD is going the same way. The momentum has changed.
Sentiment: Strong Sell
The jumped to 200 was pure momentum. This thing could hit the deck at a 100 within a 4-6 weeks -- roundtripping
Sentiment: Strong Sell
This stock is a goner. All momentum players will exit. Why take the risk? People play this because of momentum and that momentum just evaporated.
Sentiment: Strong Sell
Check out AMZN market cap / EBITDA ratio versus GOOG - mind boggling that AMZN would be twice GOOG esp. when AMZN growth are slowing fast. Expect AMZN to get a 50% haircut in the coming days and months.
The problem with "leading" is that you end up with obsolete hardware. It's not always good to be "leading" esp. if you don't know how to be profitable. Leading and losing money is simply you burning money to light a path for the competition to know how they can beat you.
Yes, you have a certain customer base, but all key customers would have already planned to ensure their platform are cloud agonistic.
I am sure GOOG and MSFT already have plans and tools in place to help key customers transition from AMZN.
So,you would agree that MSFT is good at destroying the competition, be it with their strategies, products, services, sheer size of cash pile, what not?
I think MSFT considers AMZN its competition? You realize that MSFT is already matching AMZN prices and is in a better position than AMZN to further cut prices.
Btw, you know MSFT owns Windows and SQL Server right? A large number of cloud servers do make use of, you got it, Windows and SQL Server. AMZN has to pay for Windows and SQL Server licenses, MSFT does not.
AMZN got lucky with the sales tax regulations. That luck is going away.
We have been heading lower for a while. See how many times we bounced between 270s and 250s prior to earnings. That was probably due to some folks knowing something exiting. The bounces up were due to fools playing other greater fools.
Now, it's down and down. If AMZN does pop, I would short and double short.
200 is a given...there is no driver to bounce this stock. Once the trust has been lost, it will be hard to regain...I think AMZN has lost its credibility.
Quite a few analysts are starting to question the AMZN growth and profitability story. When folks start to question your strategy, when the benefit of doubt disappears, companies, such as AMZN, with obscene valuations will drop like a rock.
Here is basic math. Data are from YHOO:
1. AMZN did ~64B in revenue.
2. In order to grow 20% this year, AMZN will need to pull in an extra 12.8B next year for a total of: 76.8.
3. In order to growh 20% next year, AMZN will need to pull in 15.36B. See the trend? That's called the law of the large number.
And, in order to pull off 12.8B extra in revenues, AMZN needs to spend A LOT of money on the infrastructure to support that extra 12.8B. Well, how much would AMZN need to spend to support yet 15.36B on top of that?
AMZN has been losing money head of heels and if they have not been able to master the management "economies"of scale" to be profitable with 64B in revenues, what make you think AMZN will be able to master the economies of scale when revenues go to 76.8B and beyond?
All well-managed business are profitable at any given revenue point. That's why they call in "well-managed".
Sane businesses make money. Insane businesses lose money. ANYONE can sell a buck for 99 cents.