Author Topic: AMZN - Amazon.com Inc.  (Read 642032 times)

txlaw

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Re: AMZN - Amazon.com Inc.
« Reply #80 on: January 15, 2013, 10:02:52 AM »
http://www.cbsnews.com/video/watch/?id=50138922n

60 minutes piece on robots and job growth.  Shows Kiva Systems robots at work.  Kiva is owned by AMZN.


Grenville

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Re: AMZN - Amazon.com Inc.
« Reply #81 on: January 15, 2013, 11:48:38 AM »
Well, if you had 25 or 50 CDs, ripping them would take some effort.  It's nice, but I'm already all digital anyway, and I didn't buy them from Amazon in the first place, sooooo I'll just see myself out.

That's pretty much my point.  Who has a music collection on CDs and hasn't ripped them already?  Unless they don't want the digital version of them, then this Amazon feature is of no use.   It would be convenient I suppose if you were buying new music, but I wouldn't pay more for this feature.    Not that I've purchased a CD in many years anyway.    My kids have lists of songs they want to buy, not albums.   And Most of us old folks already own all the music we want or need (I've already got 3000 or so of my favorite songs on my ipod).    Who exactly buys CDs?

This may not change your opinion on the service, but I forgot the feature of scanning your itunes library and adding those songs automatically to your Amazon Cloud Player in 256kbps. It's a nice feature to backup your music in the cloud and download it in high quality.

"In July, Amazon added new scan and match technology that enables customers to import music into Amazon Cloud Player by scanning their iTunes and Windows Media Player libraries and matching songs on their computers to Amazon’s music catalog. All matched songs – even music purchased from iTunes or ripped from CDs – are upgraded to high-quality 256 Kbps audio and are made available instantly in customers’ Cloud Player libraries, making it even easier for customers to enjoy their entire music collection anywhere."

valueInv

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Re: AMZN - Amazon.com Inc.
« Reply #82 on: January 29, 2013, 01:51:32 PM »
This is what happens when you miss analyst expectations:

http://www.google.com/finance?client=ig&q=NASDAQ:AMZN

Oh wait, never mind.  ::)

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Cardboard

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Re: AMZN - Amazon.com Inc.
« Reply #84 on: January 31, 2013, 10:22:59 AM »
5 brokerage houses rushed yesterday to upgrade the stock following these: "much better than anticipated operating margin". I have not seen any discussion about valuation regarding these upgrades in the press. It is a game of: if the results appear good, then put a price target 20 to 30% above the current price.

Now, regarding the results, they were abysmal. They missed on sales, earnings and forecast for two quarters in a row now. For any normal company, tech or not, this would have resulted in a roughly 20% drop in the share price. Not for Amazon with its current $121 billion market cap. It has to be the most manipulated stock on the market.

Now, getting back to these "amazing" operating margins, they reported $405 million in operating income in the fourth quarter which is the most important for any retailer, read most profitable. For the year, it was only $676 million and that is on $61 billion in sales. You can add back stock compensation of $833 million if you like since the way it is portrayed by Amazon, it is not a real cost. The operating income is still no good for what is described as a leader in the business. And certainly way too low to justify a market cap of $121 billion.

We also keep hearing about investments affecting costs. It is funny because investments are normally CAPEX and increasing costs due to more buildings to maintain and the hiring of more staff become on-going costs. Also, normally when you make heavy investments, it shows in sales growth. Interestingly enough, sales growth has declined to 22% in the 4th quarter. Are we are starting to see the law of large numbers slowing them down?

And please, don't tell me about Amazon being a Costco or Wal-Mart. These two great firms always made a significant profit margin after taxes despite them growing at very fast rates for decades. 

Anyway, the numbers and valuation don't add up. I am losing money on this short so far and it sucks, but I think that I will be proven right long term. If there was a hint of doubt on their profitability or just about 10% of the attention that is paid daily on Apple's future, this stock would plummet.

Cardboard

txlaw

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Re: AMZN - Amazon.com Inc.
« Reply #85 on: January 31, 2013, 10:43:22 AM »
Cardboard, you're a smart guy.  Why the heck are you wasting your time shorting a company like AMZN?  Are you not finding any suitable long ideas?

ItsAValueTrap

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Re: AMZN - Amazon.com Inc.
« Reply #86 on: January 31, 2013, 10:50:43 AM »
Is Amazon intentionally losing money on part of its business?  (e.g. Kindle)

If you separate out the online retailing aspect of its business from the intentionally money-losing parts of the business, what would the right valuation be?

Sometimes companies have money-losing segments that make them hard to analyze.  A few businesses in the world intentionally lose money trying to hit a critical mass... webVan (total failure), new media formats like BluRay and HD-DVD, Microsoft with its Bing search engine, Starbucks (kind of; they were unprofitable when they started), etc.

2- How can they not make money in online retailing? 

Their used books business should be an amazing business with extremely high margins (to me, it is like a mini-eBay).

Their new books business should be a good business.  Books are high margin items and they don't have inventory and bricks&mortar costs like the traditional bookstores that they are putting out of business.
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ShahKhezri

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Re: AMZN - Amazon.com Inc.
« Reply #87 on: January 31, 2013, 10:59:09 AM »
5 brokerage houses rushed yesterday to upgrade the stock following these: "much better than anticipated operating margin". I have not seen any discussion about valuation regarding these upgrades in the press. It is a game of: if the results appear good, then put a price target 20 to 30% above the current price.

Now, regarding the results, they were abysmal. They missed on sales, earnings and forecast for two quarters in a row now. For any normal company, tech or not, this would have resulted in a roughly 20% drop in the share price. Not for Amazon with its current $121 billion market cap. It has to be the most manipulated stock on the market.

Now, getting back to these "amazing" operating margins, they reported $405 million in operating income in the fourth quarter which is the most important for any retailer, read most profitable. For the year, it was only $676 million and that is on $61 billion in sales. You can add back stock compensation of $833 million if you like since the way it is portrayed by Amazon, it is not a real cost. The operating income is still no good for what is described as a leader in the business. And certainly way too low to justify a market cap of $121 billion.

We also keep hearing about investments affecting costs. It is funny because investments are normally CAPEX and increasing costs due to more buildings to maintain and the hiring of more staff become on-going costs. Also, normally when you make heavy investments, it shows in sales growth. Interestingly enough, sales growth has declined to 22% in the 4th quarter. Are we are starting to see the law of large numbers slowing them down?

And please, don't tell me about Amazon being a Costco or Wal-Mart. These two great firms always made a significant profit margin after taxes despite them growing at very fast rates for decades. 

Anyway, the numbers and valuation don't add up. I am losing money on this short so far and it sucks, but I think that I will be proven right long term. If there was a hint of doubt on their profitability or just about 10% of the attention that is paid daily on Apple's future, this stock would plummet.

Cardboard

Agree completely, this is my largest short ever at 12.5% of assets.  I was at 4% 2 weeks ago, and added significantly at 276 and 269 a week ago.  Now avg at 263. 

Also thinking of adding to my CRM short, current avg at 165.

bargainman

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Re: AMZN - Amazon.com Inc.
« Reply #88 on: January 31, 2013, 07:34:31 PM »
wow..  the streets are covered with really smart value guys who shorted great companies on valuation.  It's a game I will never ever play.  If I ever short it will be by buying puts (limited downside) not shorting stock (unlimited downside, and accelerating downside as the stock goes up).  If I were either of you, I'd make sure to buy some leap OTM calls in case, assuming they aren't too hard to get (thereby turning the short position into a synthetic put and limiting your loss potential).  This is a dangerous game you're playing...  IMHO.  Amusingly there is another value investor with a reasonable record (won hulbert's recent award iirc) who is long amzn.

longinvestor

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Re: AMZN - Amazon.com Inc.
« Reply #89 on: February 01, 2013, 07:37:28 AM »
FWIW, want to share my view as an Amazon customer. I've no earthly idea what all this means for the stock price. Zero interest in that.

Somehow or other, Amazon has become my most frequent shopping location. I started buying "exotic" items which would typically make me go from store-to-store to find, then I started buying into Electronic items and then into "large" items. Heck, I've been sending Gift Cards to folks (used to be iTunes Gift cards before). The shopping convenience is unmatched. Most of the stuff I buy are new items, mostly branded. Speed of delivery is fanatastic almost without exception. The $79 prime membership is easily paid by not driving. (Two gas fillings per year).

Packaging is something I've worried about a little and they have to work on this more. Also they need to come up with shipping and handling options of large items especially thru my front door and into the house. Cannot see how they can handle more volume of large stuff without local arrangements. UPS / Fedex is unwieldy for this. And the other thing I think about is returns, again of large items. I came very close to doing something like this and decided against.

And I'm not a 20-something customer, I know several in that demography that buy everything from Amazon. Hearing that city dwellers are more and more into this kind of shopping.  My Amazon spend is in 4 digits now! It was in 2 digits a short while back. And I don't like to overspend, Walmart/Sam's club and two low cost local groceries are it for me. Amazon is doing something right!