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Timothy Phillips

 
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  • Amazon.com Q2 2013 Earnings Preview [View article]
    Salerno - Target average is at $315, only 5% higher!!! ... they will all start raising targets if it holds through earnings. Finances be damned!
    Jul 11, 2013. 03:02 PM | Likes Like |Link to Comment
  • ChannelAdvisor Data For Amazon In June Is Out, Conclusion Remains The Same [View article]
    Put volume is up significantly though .. that is what I think is driving the price higher. Allows for manipulation when coupled with low underlying volume.
    Jul 11, 2013. 02:35 PM | 1 Like Like |Link to Comment
  • ChannelAdvisor Data For Amazon In June Is Out, Conclusion Remains The Same [View article]
    Gas costs reflect oil prices on a 4-6 week lag, so Q3 is already almost baked in with WTI over $100/barrel.
    Jul 11, 2013. 02:24 PM | 1 Like Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    KRK,

    Here is what makes up the growth (based on regression models of industry and market data):

    1P: 17.5% (down from 18.0% last Q)
    3P: 34.0% (down from 39.4% last Q)
    AWS: 56.0% (down from 59.3% last Q)
    Jul 11, 2013. 02:22 PM | Likes Like |Link to Comment
  • Amazon.com Q2 2013 Earnings Preview [View article]
    Amazon was also initiated by Husquahanna as a "perform" with a price target of $370. I am sure that has helped fuel the 2x market performance today as well.
    Jul 11, 2013. 12:10 PM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    FWIW, my AMZN model now stands at the following for Q2 based on channel advisor, US retail sales, global retail growth, Currency F/X, Q2 final gas prices, etc... (this does not include the potential accounting change):

    Revenue: $15.539B (+21.1% Y/Y)
    Shipping Expense: $1.226B
    GM%: 28.1%
    Fulfillment: 11.7%
    MKT: 4.4%
    T&C: 9.4%
    G&A: 1.7%

    Operating Profit: $103M (0.7%)
    Net Income: $20M (0.1%)
    EPS: $0.04
    Free Cash Flow: $32M (op CF: $732M, CapEx $700M)

    With Oil heading up gas prices will be high in Q3 - and hence the impact on margin. Here is my Q3 FCT:

    Revenue: $16.6B (+ 20.0% Y/Y)
    GM%: 27.7%
    Op Inc: $57M (0.3%)
    EPS: $0.06
    FCF: $401M
    Jul 11, 2013. 12:08 PM | Likes Like |Link to Comment
  • ChannelAdvisor Data For Amazon In June Is Out, Conclusion Remains The Same [View article]
    Hi Paulo - thanks for update. My model now stands at the following for Q2 based on channel advisor, US retail sales, global retail growth, Currency F/X, Q2 final gas prices, etc... (this does not include the potential accounting change):

    Revenue: $15.539B (+21.1% Y/Y)
    Shipping Expense: $1.226B
    GM%: 28.1%
    Fulfillment: 11.7%
    MKT: 4.4%
    T&C: 9.4%
    G&A: 1.7%

    Operating Profit: $103M (0.7%)
    Net Income: $20M (0.1%)
    EPS: $0.04
    Free Cash Flow: $32M (op CF: $732M, CapEx $700M)

    With Oil heading up gas prices will be high in Q3 - and hence the impact on margin. Here is my Q3 FCT:

    Revenue: $16.6B (+ 20.0% Y/Y)
    GM%: 27.7%
    Op Inc: $57M (0.3%)
    EPS: $0.06
    FCF: $401M
    Jul 11, 2013. 12:05 PM | 3 Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    Salerno - looks like that $292 point (technical wave peak) we discussed continues to provide resistance. If it holds below that today, $270 (50% retrace) is possible prior to earnings.
    Jul 10, 2013. 02:57 PM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    What is truly amazing is that at these prices, no one of significance will take profits with the earnings risk 2 weeks away (1.2M shares today so far at 2:15pm???). Even if they believe in the story, after a run like this you should take your initial capital off the table as a hedge.

    So either they are waiting right up until the day or two prior to earnings (like last time), or else they know something we don't ...
    Jul 10, 2013. 02:13 PM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    sfphoto - you made me laugh, but they essentially do that now with massive amount of RSU's and options they pay employees with that generates lots of cash flow and dilutes shareholders.

    You probably just gave them a great idea. Issue just 6% (~ 30M shares) and pay off all payables with no cash spent. The stock would probably go up in spite of the dilution, and their current ratio would rise - certainly cheaper than going for more debt.
    Jul 10, 2013. 09:50 AM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    Agreed (I think we are saying the same thing), as it was the second half of 2011 when the earnings really started to fall off the table .. so in the time frame that Michael discussed (early to mid 2011), investors just saw the massive revenue growth and great Free Cash flow with the investments in growth just keeping EPS flat. (hence the huge increase in stock price during a down S&P500).

    Then the Oct 2011 call shocked investors with terrible earnings and guidance, and then the stock tanked from $246 to $173 (the "correction" due to "overvaluation" as you point out).

    So, at least the market acted rationally in 2011 for AMZN (pounded AMZN when they didn;t perform when the market was down). That should return if the overall market turns (like 2011).
    Jul 10, 2013. 08:46 AM | Likes Like |Link to Comment
  • Amazon's Reward Could Be Worth The Risks [View article]
    Gary/Paulo - I wrote in this link how Peter Lynch would have approached Amazon:

    http://seekingalpha.co...
    Jul 10, 2013. 08:07 AM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    I think 2011 was different as that was AMZN's greatest growth year (> 40%, and added $14B in new revenue) and had profits and significant free cash flow.

    They are growing at half that rate now with no profits and little cash flow.

    An interesting chart is to look not at growth % for AMZN, but the amount of revenue $ they add ... the peak was 2011 at $14B .. they added $13B in 2012, and FCT to add $12B in 2013. So, not only is the % growth shrinking, but the actual amount of revenue added as well. It could be there are capacity/logisitcs issues in adding more than $14B at this point. It is a lot revenue to add each year (i.e. the law of large numbers).
    Jul 10, 2013. 08:05 AM | Likes Like |Link to Comment
  • Amazon To Take On FedEx And UPS? Or Should It Consider An Acquisition? [View article]
    Look, the whole concept of this is ridiculous for 2 reasons:
    (1) for either FedEx or UPS, AMZN is small piece of the entire business, so it is not really a vertical integration play - they would lose most of the other FedEX/UPS revenue as customers would not ship through their competitor AMZN. The one who would win would be the one who is not bought (either UPS or FEDEx) as they would pick up massive amounts of new business.
    (2) Amazon is out of cash - they can barely fund current operations right now, even with a load of new debt. This would need to be an all stock deal, which would crush AMZN as their FWD P/E is > 100, and FedEX/UPS ~ 15 .. this would crush AMZN P/E and make them actually valued on forward earnings (rather than a dream that was Amazon).
    Jul 10, 2013. 07:50 AM | Likes Like |Link to Comment
  • 1 More Reason To Hate Amazon's Valuation [View article]
    It has been true over and over, but for most shorts it just doesn't reach the level that are short at unfortunately.

    Even with this incredible run recently, AMZN is trailing the S&P500 and the NSDQ by quite a bit for the CY. That tells me that this is not the "risk-on" trade of last year (other own that privilege now, like TSLA, NFLX, etc..). While I don't think it will drop significantly until the market turns, when the market does turn, this should drop much faster.
    Jul 9, 2013. 05:23 PM | Likes Like |Link to Comment
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