I think this post from YAHOO board was not intented as a joke
AMZN comparatively undervalued; worth $1,029 today
based
by: In_Terrorem
47432 of 47451
on price sales/comparison with another but less established etail category killer -- i.e., using the
multiple of eBay, which is selling at 238x trailing 12 months sales. Apply 238x to AMZN's ttm
sales of $8.87, and AMZN should be selling at $2,187. I have refined this analysis to reflect that
eBay's multiple is higher on a trailing 12 months basis (IMO due to its relative infancy and the
mathematical fact that when you are smaller, it is easier to post large % gains). eBay sales are up
900% for its past 9 months; AMZN sales are up 430% for its past 9 months. So I discounted
eBay's p/s by .486 (900/430) to produce a sales growth adjusted multiple of 116x for that should
apply to AMZN. 116 x $8.87 = $1,029. AMZN is worth $1,209 today using eBay's price/sales
ratio, as adjusted to ensure comparability, IMO. My analysis suggests that AMZN is way
undervalued comparatively speaking. $1,029 is almost a four bagger from where we are now.
Since eBay is only beginning its focus on marketing expense, which suggests that its focus on
revenue growth rather than profit will be similar to AMZN, while AMZN is well on its way to
scaling up, and is not constrained by the available supply of beanie babies and antiques to
auction, I expect AMZN to produce
superior sales and profitability in the long run. So perhaps AMZN should be selling at $2,684
instead. That would be excellent also. |
