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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 227.58+0.4%3:59 PM EST
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To: H James Morris who wrote (129255)7/27/2001 2:50:53 PM
From: Rob S.  Read Replies (1) of 164684
 
It has really taken a beating. I think it is an excellent long term buy however painful it is to say that now. Unfortunately, I do not see a short term rebound in their core business. However, they have taken measures to reduce costs and are sitting on a large amount of cash - about $4 per share. They expect to see a further drain on capital reserves of about $7-10 million through the rest of the year and a modest rebound in business. That means that the company should have about $3.50/share in cash and investments. So the stock is currently trading for cash, discounting all sales, growth potential and future earnings. I think Breezecom (ALVR after the merger) has been adversely effected by the fact that several competitors are struggling with sharper drops in sales, widening losses and debt structure. There is a threat that many of these companies won't make it at all. They have or must get more financing to keep their businesses in operation. The situation is far from that at Breezecom. In fact, if the current downturn were to continue for three or four more years BRZE would still have cash reserves left.

I think that business will turn up significantly by the middle of next year. Telecommunications spending in general may stay in a slump longer than the segments that serve the last mile connection to customers pocketbooks.
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