Gary - here's a provocative piece from Bloomberg tonight - re: Amazon valuation-
>> BN 5/3 Dreman Chairman Says Stocks Are Overvalued, Forbes Reports
New York, May 3 (Bloomberg) -- David Dreman, chairman of
Dreman Value Management of Red Bank, New Jersey, recommends
investing only in stocks with values in line with estimated
earnings rather than the inflated prices of some recent market
leaders, Forbes magazine reported. Dreman says stocks are
tremendously overvalued according to a standard earnings-discount
model, which discounts all future earnings to the present time to
determine a stock's value. For example, Amazon.com Inc. trades at
87, or 1,745 times 1999 earnings estimates, and with a 10 percent
discount rate on future earnings, it has a present value of $3.46
a share, Dreman's model determines, the magazine reported.
Amazon.com shares rose 16 percent Monday after the online
bookseller said its loss was narrower than expected, it acquired
three Internet companies and will split its stock 2-for-1. <<
Hmmm....$3.46 a share.......sounds about right. |
