Seeking Alpha

Rich Rezny  

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  • Amazon Earnings Preview: 5 Metrics To Watch [View article]
    Timothy, thanks for a good article. Great metrics to follow.
    Jan 27, 2013. 12:31 PM | Likes Like |Link to Comment
  • Amazon Looks Overvalued, George Jetson [View article]
    215304, thanks for your comment. It looks like AMZN achieved a net margin above 4% in 2004 and 2005, at least according to Morningstar data. I concede that that margin might be a stretch next year. However, as I mentioned in the article, I believe that fulfillment costs, many of which are fixed costs, will be less as a % of sales in coming years. In other words, these costs will be spread out over more sales as sales grow.

    For pricing, I find it remarkable that AMZN's gross margin has been stable at about 22.4% for the past five years UNTIL recently where, for the trailing twelve months, the GM% has been 23.3%. They needed to mark up their cost of goods just a little bit higher to get that added profitability in a year where they needed it most. It's nice to have that kind of flexibility.
    Sep 28, 2012. 12:48 AM | Likes Like |Link to Comment
  • Amazon's Imminent Liquidity Crunch And Share Price Collapse [View article]
    I agree with this point. They have recently added a lot of capacity (see fixed asset purchases per above which were large increases in square footage at their fulfillment centers). As sales grow into this capacity, they will be able to absorb operating costs better and you might see a net margin back up to ~3.4% instead of the 1.3% where it is today. Great article!
    Sep 24, 2012. 07:31 PM | Likes Like |Link to Comment
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