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Amazon.com (AMZN) Q4 EPS of $0.38 beats by $0.19. Revenue of $17.43B (+35% Y/Y) misses by $780M....

Amazon.com (AMZN) Q4 EPS of $0.38 beats by $0.19. Revenue of $17.43B (+35% Y/Y) misses by $780M. Expects Q1 revenue of $12B-$13.4B, largely below $13.4B consensus. Expects operating income of -$200M to $100M. Shares -8.5% AH. (PR)
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Comments (40)
  • Wall Street Smart
    , contributor
    Comments (474) | Send Message
     
    Getting clobbered afterhours.
    31 Jan 2012, 04:15 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    coming back some .....over reaction...it will be fine
    31 Jan 2012, 04:17 PM Reply Like
  • criticalbear
    , contributor
    Comments (84) | Send Message
     
    sometimes, i wonder if a $780million miss, which represents a 4% miss deserves a 8.5% drop.
    31 Jan 2012, 04:19 PM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    0.99% net income margin.... OUCH

     

    Total assets $25.278B .... ROA is 2.72% annualized ... they would earn more converting their entire asset base into cash and buy 30-year Treasury bills
    31 Jan 2012, 04:22 PM Reply Like
  • Positive Equity
    , contributor
    Comments (483) | Send Message
     
    This miss was obvious to any serious investor. Amazon is investing in future growth streams. Investors will be buying once the selling calms down. Amazon Kindle is now the only serious competitor to Apple in the tablet business. Go long AMZN when all the panic selling calms down.
    31 Jan 2012, 04:26 PM Reply Like
  • Wall Street Smart
    , contributor
    Comments (474) | Send Message
     
    This is the same thing I have heard for 5 years. PE does not matter. ROE does not matter. Book value does not Matter. Look where it has landed the longs. Love the company, hate the stock
    31 Jan 2012, 04:29 PM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    clearly people aren't voting with their wallets

     

    while S&P500 had a golden cross today (not sure if it still holds at closing), AMZN experienced the DEATH CROSS in late Dec 2011, and with today's after-hour drop, it'll be below both the 200SMA and 50SMA
    31 Jan 2012, 04:30 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    the kindle is just getting rolling....only been out a quarter just getting its legs under it....
    31 Jan 2012, 04:31 PM Reply Like
  • julesa
    , contributor
    Comments (17) | Send Message
     
    "This miss was obvious to any serious investor. Amazon is investing in future growth streams."

     

    Good explanation for an earnings miss, but it's an odd way to justify a revenue miss.
    31 Jan 2012, 04:38 PM Reply Like
  • Wall Street Smart
    , contributor
    Comments (474) | Send Message
     
    So come back and own the stock when Kindle and other initiatives monetize. AMZN has to show incremental earnings power with its sky high PE and it is not doing the same.
    31 Jan 2012, 04:38 PM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    exactly.... we used to laugh at triple digit P/Es during Dot-com era, and yet AMZN was at P/E 102 before the earnings and somehow no one questions it

     

    Meanwhile, AAPL, the one that's shown ridiculous growth in both top line and bottom line (and delivered the single most profitable quarter ever of any US non-energy company), is trading at P/E of barely 13.0, yet we hear daily stories about the fairy tale ending
    31 Jan 2012, 04:41 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1514) | Send Message
     
    And how long will the current model they are trying to build be viable? Their previous models ( e.g. selling physical books ) was profitable for a few years. Why would anyone pay such a high price for uncertainty? Even if Kindle gets serious tablet marketshare, how long will that last and how much profit will they generate?
    31 Jan 2012, 05:04 PM Reply Like
  • dgresl00
    , contributor
    Comments (138) | Send Message
     
    @scott trader - If the Kindle is "just getting it's legs under it", why is next quarter so bad? Why wouldn't all those Kindle sales translate to profits from all the digital media revenues as owners buy books, apps, etc.? This company just produced $1.37 inprofit for 2011 and after the numbers are adjusted for their 1Q view in 2012, they will be projected to do in the neighborhood of $1.65 for 2012. How does this possibly justify a $180 price? Revenue growth is clearly slowing and there is no catalyst for profit to grow at a higher percentage than sales. IMO, Amazon is a $100 (at best) stock trading at $180.
    31 Jan 2012, 05:32 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    patience................ Bezos . personally worth 19 billion amzn mkt cap88 billion....he loves his co. and his job........Just like S.J. did his....he's growing the co..... this soft economy isn't great for robust sales.......
    31 Jan 2012, 05:44 PM Reply Like
  • sunkarthik
    , contributor
    Comments (51) | Send Message
     
    Worst PE ratio..makes apple look like the dollar store...kindle is a joke and draining cash from amazon.
    31 Jan 2012, 07:23 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1514) | Send Message
     
    This is all before their sales tax advantage ends.
    31 Jan 2012, 04:29 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    maybe amzns margins are minimal but...................... competition is drying up...where do you have to turn......
    31 Jan 2012, 04:47 PM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    I think his point is that Amazon is great for the consumer but bad for the shareholder
    31 Jan 2012, 04:54 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1514) | Send Message
     
    I dont think WMT and TGT are going out of business.
    31 Jan 2012, 05:01 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    compare amzn target and walmart charts 5 year ten year ......amzn small percent of my portfolio....perception of growth.....never fight the trend....
    31 Jan 2012, 05:13 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1514) | Send Message
     
    @scottrader: "never fight the trend": i'm sure that worked well for those that bought NFLX at 300.
    31 Jan 2012, 05:47 PM Reply Like
  • scott trader
    , contributor
    Comments (5719) | Send Message
     
    I have nflx service tethered to five devices I am not enamoured,,,,it is a good short....if u are so sure short amzn and I will congratulate you if it works out .......I am an aapl holder and prefer west coast tech and innovation.......
    31 Jan 2012, 05:53 PM Reply Like
  • RK
    , contributor
    Comments (400) | Send Message
     
    AMZN makes Whole Foods (WFM) look good. WFM ROE is 12.77%, ROA is 8.41%, Div rate is 0.7%, PE is 38. All sources are from Yahoo Finance.
    31 Jan 2012, 04:42 PM Reply Like
  • BigJ1260
    , contributor
    Comments (206) | Send Message
     
    Most states and even Feds are looking at legislation to have sales tax charged at transaction by Amazon - will be huge hit to their already miniscule margins and/or to their value proposition vs. brick & mortar
    31 Jan 2012, 04:56 PM Reply Like
  • kirk otis
    , contributor
    Comments (305) | Send Message
     
    With a p/e of 100, and a loss expected next quarter, this one has a ways to go before the valuation is reasonable.
    31 Jan 2012, 05:03 PM Reply Like
  • marcinz
    , contributor
    Comments (34) | Send Message
     
    lesson learned from Google and Apple; and following simple rule buy low sell high 20% made in a month :) thank you Amazon

     

    On a serious, however, from all 3 listed above I actually like Amazon great prices, service and delivery. Although, Fire sucks unless you`re using buying it from amazon but you can do that from any other tablets. So, why spending money on something low quality I rather spent more but have full use of it.

     

    Oh well, I guess it`ll provide another 20% this month :)
    31 Jan 2012, 05:25 PM Reply Like
  • bailinnumberguy
    , contributor
    Comments (1166) | Send Message
     
    The Kindle Fire will be remembered as the Edsel of the tablet market. It's designed to create sticky Amazon customers as a virtual loss leader. AMZN gets no margins and has an absurd P/E ratio. People have been speculating on the company's potential for a decade already. Investors will slowly wake up to the reality, that Amazon as a company has a great business model, but it simply doesn't offer a return to investors apart from the contrived euphoria of its 'potential'. This is a nice shorting opportunity.
    31 Jan 2012, 05:43 PM Reply Like
  • thesuer
    , contributor
    Comments (371) | Send Message
     
    From A to Z, from zero to hero, a visionary CEO will have his fights with the stock markets and analysts. My point is that Amzn is undervalued based on its business model and all the analysts dont know what to compare it against.

     

    Ex. 35% YoY growth in revenues and 50% beat on Earnings is awesome. So if analysts are expecting more revenue growth and less earnings growth- What is better.

     

    For me earnings is what counts and I am betting tomorrow a lot of people are buying Amazon stock as it is on discount. At least I am....
    31 Jan 2012, 06:13 PM Reply Like
  • dgresl00
    , contributor
    Comments (138) | Send Message
     
    ....a "50% beat on Earnings" and "for me earnings is what counts"? so if the expectation had been $.01 would it have been a 3500% beat? What about the fact that they are guiding the first quarter to be more than 50% less than expected? The market is obviously full of people like you who have the same view here or this stock would be less than half of where it is. As I stated above, a $180 stock with trailing earnings of $1.37 and forward earnings of $1.65ish is hugely overvalued and I will remain short. If "earnings are what counts", what do you expect their earnings to be and what long run multiple should a retailer have?
    31 Jan 2012, 06:36 PM Reply Like
  • sunkarthik
    , contributor
    Comments (51) | Send Message
     
    beware of the words "expect to make operating losses" for the next quarter. Take long puts and sit tight.

     

    Looks to me like apple has a curse on all itz competitors..Apple has shown volumes and profits don't have to be inversed to each other.

     

    Google androids, amazons kindle just want the headlines..kindle outsold this outsold that..kindle had best ever quarter, android activations are #%#^% ging through the roof. Then u see the reality in results.
    31 Jan 2012, 07:31 PM Reply Like
  • thesuer
    , contributor
    Comments (371) | Send Message
     
    How do you value the future? A company that is trying to sell everything under the sun under one roof is obviously going through a cost barrier that the analysts cannot begin to discount and understand, a discounted cash flow analysis gives you a value of 220USD.

     

    I have one question- how can analysts expectations be low of earnings and high on revenue and if AMZN beats on earnings then they must have a very well run ship to do that with lower revenues?
    1 Feb 2012, 01:56 AM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    then I hope your long AMZN doesn't implode this morning
    1 Feb 2012, 09:26 AM Reply Like
  • blueguy19
    , contributor
    Comments (28) | Send Message
     
    Very disappointing results. I think the AMZN time has come, go SHORT. I don't like the idea of revenue loss when they introduced Kindle Fire this quarter. It should have been a boost to the revenue, but clearly it was not.

     

    Moreover the reception of Kindle Fire has been mediocre. I hear lot of ppl actually returned the tablet after using for 3 to 4 weeks, not knowing how it is useful or replace other devices.
    31 Jan 2012, 06:55 PM Reply Like
  • sunkarthik
    , contributor
    Comments (51) | Send Message
     
    I think the stock is going to end a minimum 20% down this year..if a any sales tax legislation kicks in it should do a blackberry
    31 Jan 2012, 07:33 PM Reply Like
  • sunkarthik
    , contributor
    Comments (51) | Send Message
     
    "More surprisingly, revenue grew at a slower clip than Wall Street had expected. The company also gave a disappointing guidance for the current quarter. Investors punished the online retailer's stock in after-hours trading."

     

    was reading an article that said "investors punished the online retailer's stock" I would say amazon $#@%$# investors by letting out a stream of fluff and pumping the stock up..even now kindle was up 177% but they won't release actual sales nos ?!! 1000 units to 3000 units is 200% how many are they actually selling..
    31 Jan 2012, 07:39 PM Reply Like
  • JayXu
    , contributor
    Comments (266) | Send Message
     
    Just lost 10%. Such a great company, but such a bad stock.
    31 Jan 2012, 09:08 PM Reply Like
  • monkeywrenchgirl
    , contributor
    Comments (22) | Send Message
     
    They also run a labor-intensive operation and cannot even post profit while relying upon cheap, temporary labor. If there is an upturn in overall hiring, Amazon will be unable to staff their godforsaken warehouses unless they provide greater compensation to their workers. I know that investors take cheap labor for granted, hey, you actually demand such abuses; however, it is miserable work for low wages and I can't wait to see the day when Amazon can't staff their warehouses and continue to provide first-class service at bargain-basement prices. Soulless operation.
    31 Jan 2012, 11:11 PM Reply Like
  • svrionis
    , contributor
    Comments (18) | Send Message
     
    Great company. Terrible stock. Seems to me they'd have to have net profits of 4.5 to 5 billion to even get this things close to a more normal 20 P/E. How many years into the future is that?

     

    Once upon a time the assumption was that margin would improve but it seems with more competition and a drive for revenue (which is also missing now) they are earning even less.
    31 Jan 2012, 11:58 PM Reply Like
  • Dana Blankenhorn
    , contributor
    Comments (8803) | Send Message
     
    Pretty amazing when you can double street estimates on earnings and yet get hammered. Earnings compression is obviously expected due to weaker-than-expected top line growth, but I like the company.

     

    The stock? "Madam, prices will fluctuate" as Paul Volcker said.
    1 Feb 2012, 12:11 PM Reply Like
  • thesuer
    , contributor
    Comments (371) | Send Message
     
    double down on best buy because when the sales tax hits AMZN then prices will go up and customers will return to BBY....

     

    On the other hand AMZN is building the future.....the world is online, if FB is 100 billion and a social network then AMZN is surely worth more...
    5 Feb 2012, 03:00 PM Reply Like
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