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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 210.32-5.6%Feb 6 9:30 AM EST
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To: Rob S. who wrote (26470)11/17/1998 7:56:00 PM
From: Glenn D. Rudolph  Read Replies (1) of 164685
 
For all the hype and the astounding valuation surrounding the Internet
stocks and Amazon in particular, it must be recognized that Amazon does what they do
well. I am sure that they will see greatly increased sales this fall/Christmas buying season
and that no other Internet competitor is likely to defeat their sales momentum.

I agree on not this fall. Momentum will continue.

Amazon
will likely grow to $3-5 billion in sales within five years.

I believe that the exclusive contract of Bertlemanns and AOL in Europe along with CompuServe will keep AMZN from ever obtaining that much revenue.

If competition occurs as we
think it will, those sales combined with Amazon's cost structure will result in at best
narrow profits - not high enough to sustain the current, let alone the much higher price
that investors hope for. Until that starts to happen all anyone is doing is highly
speculative, go with the flow or against it - betting against the Internet darlings is a very
risk prone gamble.

I doubt that there will ever be profits but the market will love them until Q2 of 99. Then revenue will stop growing as Bertlemans takes the Europe market and BKS in the US. Other products have lots of competition.

Glenn
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