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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 229.55+0.2%Dec 5 3:59 PM EST
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To: Oeconomicus who wrote (1211)1/16/1998 5:38:00 PM
From: doug doan  Read Replies (1) of 164684
 
Ok,

Assuming that the estimates are right at -.44/share I recalculated to see what kind of sales numbers would be needed.

Assumptions:

1. Gross Profit stays constant at 18% Sales as in 2nd and 3rd qtr.
2. Ditto operating costs at 43% of sales

Doing the math I get sales of 56 million in order to hit the -.44/share number

Couple of quick points:

56 million in sales would represent a 50% increase in Qtr-Qtr Sales. Is that likely?

Does seem to me that AMZN is in a bit of a death spiral. The more they sell the greater the losses. To fix it they need to drmatically increase gross profit and shrink operating expenses. I do not think they can do this in the scale now required.

thoughts?
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