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Amazon - The Expanding Bubble

|Includes:Amazon.com, Inc. (AMZN)

Amazon (NASDAQ:AMZN) sells digital content and merchandise to consumers with no durable competitive advantage. It might have efficient supply chain and personnel but certainly not a competitive advantage. In the end there is little profitability in this business and this is probably one of the reasons that detracts competition until the course is set for profitability which at that point is usually too late to enter the market. Secondly, it seems irrational to believe that any competitor could not do it any better than Amazon or at least as good as Amazon is currently doing its business. Amazon do not have any patent or technology superiority that will be enable them to repel competitors. Competitors will however have to work with the trust that Amazon provides to consumers. This barrier of entry can easily be breached by a few scandals or by more competitors' entering the market.

Let's have a look at Amazon's financial statements that I have compiled......

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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Stocks: AMZN