Good point, about MSFT. I suppose that's possible, But taking that arguement to it's logical conclusion would keep you out of any e-com, software, or internet stock! (which may be prudent anyway)
About the IOM/AMZN comparison, it really is not that far fetched.
I'll draw some parallels. (I'm using IOM of 3 years ago.. IOMG)
(1) Both had/have potentially huge markets ahead of them
(2) Both are/were leaders in that market
(3) Both had very small floats, and very high PEs
(4) Both had very strong revenue growth, way before profit growth
(5) Barron's HATED them
(6) The thread(s) were 'soaked' with negative postings
Now, you may say (and you would be right) that books are a commodity
item. BUT, you have to remember that what AMZN provides is a new way
to look, browse, and buy books. Where else can you read book reviews?
What other company caters to small publishers? Garage publishers?
Where can you find a selection that large? search capabilities so
extensive?
Also, what stops AMZN from using their name to expand to other areas
in electronic commerce? They are VERY, VERY smart. They are bleeding
cash to get their NAME out there.. The rest will follow.
I've always had 2 rules of investing:
(1) If revenues are there, profits will soon follow.
(2) Always invest against the crowd.
If that Barron's guy is so smart, why is he still working? He
should be on a beach somewhere...
What drew me to this stock is that in the face of all the negatives,
the stock still rises. what kind of nuts are buying this stock? ;)
kp |
