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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 229.12

-0.2%

Nov 26 3:59 PM EST

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To: Skeeter Bug who wrote (123232)	4/8/2001 2:55:23 PM
From: Alomex	Read Replies (2) of 164684

Fund manager Bill Miller keen on Amazon - Barron's `A lot of things that currently cause Amazon to lose money and generate negative cash flow -- software development costs and a purchasing disadvantage in consumer electronics -- will be over by the end of this year,'' he told the paper. ``Next year we estimate the company will be cash-neutral at worst. When that changeover happens, and it is clear they are not going to disappear...then the perception of the company and the underlying valuation will change.'' For the sake of the argument assume the changeover happens. Amazon then would have at long last become a mildly profitable retailer. The valuation would be revisited to account for this change and Amazon would be given a standard Price/Sales retailer ratio of 0.6-1x.... or $5 to $8 per share. So even under Miller's optimistic projections, one cannot justify a price above $8 per share. (And then if you add debt back into the mix, even a 0.6 price/sales ratio sounds high). biz.yahoo.com

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