Amazon.com, Inc. (AMZN) Message Board

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

AMZN 232.88

-0.8%

3:59 PM EST

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To: Ken Pomaranski who wrote (1880)	3/3/1998 12:45:00 PM
From: Don Westermeyer	Read Replies (1) of 164684

Ken, Also, they consist of simple 'comparison of valuation' models to other companies, of which such a comparison is in most cases not applicable. Examples? It is often the bulls that drag out example comparing AMZN to say for instance IOM. A bull will always say 'see what IOM or MSFT done' while a bear will point to stocks like 'NSCP' and 'BOST'. OTOH - Money is Money. Explain to me why a dollar of earnings in AMZN (which they might make in 5 years) is worth an investment $75 while the same dollar made by say TMAR (an offshore oil exploration support company with 30% growth) is worth less than $10? Don't be fooled into buying into hype! AMZN does not need a lot of analysis (either short or long). They are a simple retail business that sells only one item (two after CDs get going). This is not like Procter and Gamble or even a traditional book seller like BKS. Quite simply, you are shorting without doing your own research into this market, and without looking carefully at the companies' balance sheet. HOW WRONG YOU ARE! What on their balance sheet looks bullish to you? Is it the expanding losses? Or is it the low (almost negative) book value? Maybe it's the $85 million dollar loan at almost 10%? Guess where the stock price would be had they issued a couple million shares of stock instead of taking out a loan. That loan will need to be paid off sometime! The ONLY thing that looks good is the expanding sales, which is very good. But I'll argue that that is already more than fully reflected into the stock price. There isn't too much more to consider. Outside the balance sheet one can look forward to more and more competition. Sincerely - at what price would you consider AMZN stock to be too expensive (and then please rationalize it)? I sincerely hope you have long positions in other stocks that are more conservative than AMZN. Unless they reach about $1 billion in sales in a timely manner, which is a long way from where they currently are, one can hardly justify the stock's current price. Actually I do like AMZN the business, just think the stock price is waaaaay out in la-la land. Enough said. I'm obviously a bear (but a friendly one). Don

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