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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Anthony@Pacific who wrote (61735)	10/30/2000 3:42:07 PM
From: StockDung	Respond to of 122087

Amazon shares drop as accounting, cash flow concerns loom NEW YORK, Oct 30 (Reuters) - Shares of No. 1 U.S. Internet retailer Amazon.com Inc. <AMZN.O> on Monday tumbled as much as 8 percent in early trading as questions still loomed over the company's accounting methods as well as its cash position. By mid-morning shares of the Seattle-based Amazon recovered somewhat but were still trading down $1-1/2, or about 4 percent, at $34-3/16 on the Nasdaq stock market. Last week, Amazon posted better-than-expected financial results for the third quarter and shrugged off worries from debt analysts over the company's outlook. After the earnings announcement, Lehman Brothers debt analyst Ravi Suria repeated warnings he had made in June describing Amazon's credit as weak and deteriorating. Suria recommended investors "avoid" buying the Web retailer's convertible bonds as he continued to be "concerned about Amazon's cash picture in the first half of the year." Even more, a pair of recent articles in the financial publication Barron's also highlighted Amazon's statement in its quarterly filing that the U.S. Securities and Exchange Commission had begun an "informal" inquiry into accounting practices related to commerce-partner revenues. "Amazon.com reviewed the accounting for the transactions with its auditors and the SEC staff, and the company believes that the accounting treatment, and disclosures, were appropriate," the company wrote in its SEC filing. It said it will continue to cooperate with the inquiry. Both Barron's and Lehman's Suria also questioned Amazon's calculation of its cash flow from operations for the quarter, saying that they believe the negative $4 million Amazon quoted in its quarterly conference call was inaccurate. On Monday, however, Merrill Lynch Internet analyst Henry Blodget dismissed the concerns over debt and accounting, saying he was "comfortable with the company's calculation" of its cash flow from operations for the quarter. "We are comfortable with Amazon's cash position and reiterate our belief that (the third quarter) likely marked a positive inflection point for the company and stock," Blodget wrote. 12:14 10-30-00