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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 244.25-2.0%Nov 12 3:59 PM EST
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To: Eric Wells who wrote (68633)7/21/1999 7:18:00 PM
From: dbblg  Read Replies (1) of 164684
 
Eric,

I keep crashing the (borrowed) computer I am typing this on, so plz bear w/me. Good post. Couple thoughts:

1. I think you are being too generous w/them as far as beating the revenue and customer projections tossed around earlier today. These companies are very expensive vis a vis the projected growth precisely because people are assuming there is a lot of upside to the estimates. My own back-of-the envelope revenue estimate was substantially higher. If I follow my investing rules, I should get off here...

2. The customer count/recurring business issue is fascinating, though hard to make sense of from the outside. There is a school of thought that says AMZN's rapid sales ramp is a reflection of the ridiculous amounts of disposable income early-adopter yuppie baby boomers have, in which case customers in each successive wave will likely spend less, per capita, than their predecessors. I had expected that the ability to keep rolling out new products, as well as the larger numbers of customers in the later waves would minimize the impact of this for another 6 or 7 quarters, but the light revs. here are making me wonder about that.

Anyway, best of luck with your short. FWIW, though I am probably closing my long here, I think the risk-adjusted return for shorting is probably a LOT better with the lower-quality companies like ONSL and UBID than with the leaders.
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