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Amazon (AMZN -6.9%) is giving back most of its 2013 gains as the Street decides a revenue miss...

Amazon (AMZN -6.9%) is giving back most of its 2013 gains as the Street decides a revenue miss and light profit guidance outweigh a still-improving gross margin. Slowing growth and a lack of profits for the international ops is a concern for many, even if forex is a factor - international media sales rose only 1% Y/Y, though other merchandise sales rose 28%. On the earnings call, management admitted (echoing eBay) "there is some [international] softness from a macro standpoint," while adding Amazon is investing heavily in China, Italy, and Spain. Nomura is staying bullish, touting the fact total growth is holding steady.
Comments (12)
  • Dan Naumov
    , contributor
    Comments (324) | Send Message
     
    So, still only about 200-300% overvalued based on earnings?
    26 Apr 2013, 01:31 PM Reply Like
  • gdavidson1731
    , contributor
    Comments (159) | Send Message
     
    This is a great time to buy, and go long. I see a 2014 PT of $400
    26 Apr 2013, 01:33 PM Reply Like
  • streetwatcher
    , contributor
    Comments (74) | Send Message
     
    AMZN stocks: Down 20 points mid-day.
    Are we getting close to call it " A Santos Day"?
    26 Apr 2013, 02:30 PM Reply Like
  • Lares Capital
    , contributor
    Comments (392) | Send Message
     
    I don't think any sane person needs an excuse to sell Amazon. Owning it as a "long-term investment" is inexcusable though.

     

    Sell-side analysts are probably furiously fudging their Excel models to somehow find "strong free cash flow" in year 2025 which will justify their price targets.

     

    Did anyone notice that Amazon started actually burning money now once you include their CapEx spend and did anyone actually bother to look at "comprehensive income " statement to see that Amazon did not really earn any money at all last quarter (once you adjust foreign cash to US exchange rates)?
    26 Apr 2013, 03:19 PM Reply Like
  • Vick13
    , contributor
    Comments (129) | Send Message
     
    Abandon Ship!!!
    26 Apr 2013, 03:20 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17960) | Send Message
     
    Gross margin will always improve, due to how AMZN accounts for AWS and 3P revenues. It means nothing.
    26 Apr 2013, 03:36 PM Reply Like
  • Hayweed
    , contributor
    Comments (357) | Send Message
     
    My favorite is that down the road Amazon will be a cash cow. Apple is a cash cow and trades for less than 10 times earnings. Thus at some point Amazon will contract and will contract their PE very quickly and most likely more severely than what happened at Apple. Remember cash is worth cash. A bunch of warehouses will most likely be worth way less than what they cost to build.
    26 Apr 2013, 03:56 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17960) | Send Message
     
    And the warehouses aren't even AMZN's ... they're leased. eheh
    26 Apr 2013, 04:30 PM Reply Like
  • Vick13
    , contributor
    Comments (129) | Send Message
     
    Mark Mahaney, who still deems AMZN a buy because he likes the revenue growth and free cash flow, claims that they are uniquely able to turn their net earnings into free cash flow and he doesn't worry about the valuation because they valuate it on price to sales...

     

    Can you comment on his bias Paulo?

     

    Thx.
    26 Apr 2013, 04:26 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17960) | Send Message
     
    Valuing on P/Sales makes no sense, especially when sales have such low margins.

     

    Anyway, the analysts won't change their tunes until the stock drops significantly. It's always the same.
    26 Apr 2013, 04:29 PM Reply Like
  • bil4Bill
    , contributor
    Comments (21) | Send Message
     
    the major trend has turned down.
    26 Apr 2013, 05:42 PM Reply Like
  • Vick13
    , contributor
    Comments (129) | Send Message
     
    Wow, the Institutions is Bezos' pocket are doing everything possible to prop AMZN up and keep it above $250 today on heavy volume despite a big day for the Tech Sector. Is the long overdue breakdown to $200 coming soon?!

     

    My next 200 day Fibonacci 50% retracement is $248.50 / 61.8% retracement is $240.
    29 Apr 2013, 03:44 PM Reply Like
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