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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 222.55-4.4%3:59 PM EST
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To: sunny who wrote (190)9/8/1997 9:06:00 PM
From: Alomex   of 164684
 
I guess Amazon went up on the Fool's buy call.

I usually look for companies with a smaller downside risk than Amazon at $30, however the Fool likes longshots so it fits their investment style perfectly.

However the Fool analysis does have some errors. Comparing Amazon to the search engines is near useless. Both markets have yet to prove that they can make money.

Moreover they say it is hard to find a company with which to compare Amazon. Not really. The Web is a glorified mail order catalogue. Those companies can give us a rough guideline about the sort of profits, margins and sales that can be achieved.

Since the Web *is* a better medium than mail order, we can then suitably revise the margins and sales figures upwards and obtain a reasonable estimate.

As I said, $30 is certainly optimistic but not yet irrational. I would not short at $30 by any means.

Buy at $30? Too much risk for my personal investment style. I prefer to invest in "zero downside" companies and there are plenty of those among once overvalued stocks that have overcorrected.

Regards,

Alomex

P.s. It just occured to me that I own thousands of books, buy dozens more every year, have 24 hours immediate access to the web, yet I've only bought two books on the Web...
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