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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Randy Ellingson who wrote (114117)	1/4/2001 8:02:53 AM
From: Elmer	Read Replies (2) \| Respond to of 164684

<How do you see their financial strength? If they survive another five years, they ought to be worth significantly more than they are today.> Drugstore.com has over $2/share in cash net of liabilities and is trading at $1.31. They will post an estimated loss of $0.55 for the December quarter, but a significant part of the loss will arise from non-cash amortization. So, they have the cash to last 1-1/2 years or more and may have the cash to make it to cash flow neutral at the end of 2002. Curiously, it trades at a market cap. of about $85 million and should do roughly $200 million in revenue next year. So, its forward price to revenue multiple is about 1/4 (I think) of AMZN's which I think is about 2x (you may want to check this). What interests me is that, according to Yahoo's profile, insiders, including AMZN, own 72% of the stock and that insiders have been buying at much higher prices. One of the insiders, KPCB, has a history of resurrecting troubled investments such as Netscape with buyouts. It also has Bill Gates' wife on the BOD. Also, everybody hates this stock and it has declined from $3/share, when I first started to buy in November, to 29/32 last Friday. The tax loss selling has been aggravated by an apparently small institutional holding of about 18%. DSCM's CEO says business is fine according to press releases in the middle of January. All this said, it's a counter intuitive investment (actually speculation) that may not work out. But the same could be said of the small biotech firms that were burning through cash at the end of 1996. During 1997, Wall Street came to the rescue and got funding for many of them and their stock prices tripled or more. Finally, of the B2C models out there, I think AMZN's and DSCM's make the most sense. Thanks David