AMZN: WHEAT FIRST decreased estimate for 12/99 from $-1.64 to $-1.75 on 11/09/98
Glenn, it is "interesting" that the trend in earnings estimates is dropping lower, per Zack's [http://biz.yahoo.com/z/a/a/amzn.html], yet the average analyst buy/sell rating has been on the improve. Three months ago, the 12/99 consensus was -1.76/share, as it is currently. However, 3 months ago the average analyst rating was 2.67, which is on the verge of "hold" (there were 6 holds and no strong buys). Now it is rated an average or 1.97, which is in "buy" territory (4 holds and 5 strong buys). There are 18 analysts following AMZN, and only 12 three months ago, btw. Coincidentally, even though AMZN has managed to "surprise" to the upside by about 15% for each of the past 5 quarters, its EPS has dropped steadily from -0.21 to -0.57/share. For those of us who've been following the stock closely, we know that the estimates are generally lowered ahead of earnings announcements, which makes the "surprise" not much of a surprise at all. I think rating services like Zack's, should measure the "surprise" relatively to earnings estimates made three months earlier, just after the previous announcement. This would avoid most of potential to fudge the numbers as earnings announcement approaches. |
