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  • Why Amazon May Be Worth $165 Billion, More Or Less [View article]
    I think the balance sheet you're looking at also shows a $19B accounts payable debt, basically kidnapped money held against its will from its true owners, poor mom n' pop 3rd party retailers that would actually like to turn their inventories more than twice a year.
    Oct 28 08:43 PM | Likes Like |Link to Comment
  • California Sales Tax Receipts Show Sales Tax Collection Impact [View article]
    It's not valid for everybody, but it's a huge component of pricing. In California I pay 10% sales tax and a $6-$10 screen recycling fee upfront for devices with screens. In the past, I would've found the best model offline, price searched online, then likely purchased online because of the tax differential. AMZN will lose a lot of their big ticket sales and if they report it, I bet their average order size goes down significantly for the states that they now collect sales taxes for.
    Feb 20 03:57 PM | Likes Like |Link to Comment
  • California Sales Tax Receipts Show Sales Tax Collection Impact [View article]
    Paulo's assertion, which I agree with, is that CA should represent 12% of AMZN's volume but because of the newly instituted CA Online sales tax (this was the first quarter), it is under-represented. Therefore the cause-effect is that the implementation of the CA sales tax has severely hurt AMZN sales and as the other 41 states implement online sales taxation, AMZN's growth will slow significantly.
    Feb 20 03:44 PM | Likes Like |Link to Comment
  • What Happens When Amazon's Growth Rate Slows Just Like Apple? [View article]
    As you've said, The business lines need to be split to make any sense of the data, and preferably by merchandise category too. Buying revenue through M&A should be discounted from the overall growth story. I think operating and fulfillment expense re-occurring commitments are growing faster than organic retail growth and 3rd party fulfillment growth combined. The combination of big box price matching and sales tax should grind growth in PA, TX and CA to a halt.
    Feb 1 02:04 PM | Likes Like |Link to Comment
  • Amazon's Earnings: Holiday Retail Competition And Sales Tax In Focus [View article]
    AMZN is a custom designed conglomerate and the customer is "growth" analysts. Unlike conglomerates of the past who entered businesses for financial fundamental reasons (efficiencies, adjacencies, horiz/vert channel integration), Bezos enters businesses for the "spin" value. Every business AMZN endeavors in is a hot new growth area. It doesn't matter that AMZN has no true expertise when entering the area because a $10B company that is valued at $100B creates 10x AMZN leveraged currency ($ bills with a smiling Bezos printed on it) and that currency buys companies, new revenue streams, new expertise, and lawyers to lobby against sales tax and enemies. Unfortunately this type of growth is not unlike a Ponzi scheme and eventually will crash, the trigger being when the supply of idiots run out on the buy side. Even analysts who put ridiculous price targets on AMZN admit they have no view, insights of AMZN's business model because of AMZN's non disclosure policies.
    Jan 26 04:35 PM | 1 Like Like |Link to Comment
  • 3 Overbought And Overvalued Stocks To Sell [View article]
    No, you still missed it. Mastercard has the same model as Visa, and neither is hurt by defaults.

    Re: indirect effects, no, not much there either. When consumers delever and reduce their debt, they start using their debit cards more, which is just as profitable per transaction from Visa's persepctive
    Dec 10 01:04 PM | Likes Like |Link to Comment
  • Sell Amazon - Even The New Kindle Doesn't Warrant Sky-High Valuations [View article]
    You're on Planet Earth but it's Febraury, 1637 and you're in Amsterdam.
    Sep 13 06:49 PM | 5 Likes Like |Link to Comment
  • Why Amazon's Worth North Of $200 Per Share [View article]
    I agree it's a good tactical and operational benefit as long as growth continues in perpetuity. As the gap grows, AMZN is basically getting more and more free working capital. What happens when "organic" revenue growth flattens due to say CA and Texas sales tax collection starting next quarter? Or worse, a federal sales tax for the remaining 45 states? These are potential shocks to the only line of business where they have protective moats around, Retail. There are no moats for web services, tablets or their other businesses, just increased competition. When growth flattens, the payables catches up and kills cash flow.

    Too many valuation drivers tied to assumed growth makes for a bubble valuation. Over 80% of your enterprise valuation is based on future value generated beyond Year 5!
    Jun 11 12:28 PM | 1 Like Like |Link to Comment
  • Why Amazon's Worth North Of $200 Per Share [View article]
    Exactly. According to Yahoo Balance Sheets and Cash Flow statements as of 12/31/2011, Yahoo had $15B in payables, $2.9B in receivables and $1.5B in cash flow. AMZN is all smoke and mirrors.
    Jun 11 11:36 AM | Likes Like |Link to Comment
  • Banks Are In Eye Of Financial Storm, Don't Be Fooled By Upswing [View article]
    Losing the CIO before the position has been unwinded is a bad move in my eyes, however, I think most of the risks you mention are priced in already. I do agree that with so many headline making "shocks" that better entry points might be had in the future. Too bad I suck at timing entries and exits
    May 16 05:37 PM | Likes Like |Link to Comment
  • 3 New Ways Amazon Is Widening Its Moat [View article]
    Why are fulfillment centers a protective moat? Every retailer in the world has warehouses where e-commerce fulfillment can be initiated. Why is a new customer service facility part of this moat. These promised facilities as settlements in tax disputes seem more like a form of triage to curtail increasing damages to their business model.
    May 16 04:57 PM | 1 Like Like |Link to Comment
  • The Key To Apple's Undervaluation And Amazon's Overvaluation [View article]
    As always, well researched and well written. At what point is AMZN not considered a growth stock? It seems the fastest growth area at AMZN is promised future fulfillment centers and committed operating costs. It certainly isn't net income.
    May 14 06:01 PM | 3 Likes Like |Link to Comment
  • Amazon: 1 Sneeze Away, Like Sammy Sosa In '04 [View article]
    Amazon competes against Apple and BKS in all media including e-books, movies and music. They are trying desperately to duplicate the iTunes sales channel. In fact Amazon competes against so much more because they've entered almost every new market that's out there. There's probably not a tech company, media company, web service or intermediary service that Amazon doesn't compete against. To me this is a problem, not an asset. Their margins and execution are equally poor in all sectors that they play in and rather than garnering the scale economies of a traditional conglomerate they've over committed to operational costs that can't be turned off. They've entered arenas where they've shifted the leverage to the supplier and consumer like streaming media such that consumers want more for less and suppliers can auction off their wares at ridiculous levels. Not smart.
    May 4 05:57 PM | Likes Like |Link to Comment
  • The Crowd Is Wrong About Best Buy [View article]
    A level playing field on sales taxes and prepaid recycling fees should help 2013 sales.
    Apr 4 04:50 PM | 1 Like Like |Link to Comment
  • Amazon: A Compelling Buy Candidate In 2012 [View article]
    AMZN has been playing accounting games for years. For instance, look at their accounts payables on their balance sheet: $7.4B in 2009, $15B in 2011 whereas accounts receivables were 1.3B and now are 2.9B. I keep thinking they've pushed the revenue to cost recognition spread to its limit...until they widen it even more again and again. Why do they try so hard to protect the "growth" story when clearly the business is what it is, a low margin 1.3% business that is lower than the 4-5% retail businesses, 8-12% web services businesses, 25% product businesses, 15% media businesses that they compete against. Frankly they just don't do anything well.

    My mantra: I love Amazon but I hate AMZN.
    Apr 3 01:13 PM | 1 Like Like |Link to Comment