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Technology Stocks : Ciena (CIEN)

CIEN 209.52

+1.0%

Nov 12 4:00 PM EST

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To: Hector who wrote (5935)	12/17/1998 1:16:00 PM
From: Kachina	Read Replies (2) of 12623

I know this is AMZN drift - but I did a calculation. With their valuation and stock float, it would take about $4 billion a year in profits to make their current price justifiable. Looking around for a retailer that made $4 billion in profits, an acquaintance brought Wal-Mart to my attention. To get that level of profitability, Wal-Mart had to sell $130 billion worth. Amazon is operating in an environment where price competition is even greater and margins are going to be smaller. So $130 billion is the minimum a reasonable person could expect would be required. Now - examining the total sales of all the book dealers and CD dealers in the USA it adds up to somewhere around $15 billion. Let's be generous and assume that it is double that. That would give Amazon a zero chance of coming close to covering their market cap if they were able to take over ALL book and CD sales in the USA.

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