BTW, the great thing about a company like Amazon, which has never turned a profit and only has losses, is that when they issue more stock (instead of using cash- which Bezos probably has tied up in a hedge fund) and dilute the shareholder equity, it.. get this..
MAKES THEIR LOSSES PER SHARE SMALLER.
If they do a 2:1 stock split, then their losses per share can be hyped and press released as ".40 cents" instead of ".80 cents"
Now of course, most legitimate companies that have earnings dont like to dilute their stock, because it lowers their earnings per share.
So it seems to me that Amazon has every incentive in the world to issue hundreds of millions more shares in secondaries, then eventually their loss per share would drop to zero. Since they themselves had said not to expect any profits until the year 2002, they've got plenty of time to print more money, er, I mean shares..
So I guess knowing this, those extra 13 million shares from the junglee and planetall folks could actually make Amazon's results look better, just due to the fact that it increases the number of outstanding shares. |
