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

To: Glenn D. Rudolph who wrote (3653)	4/29/1998 4:10:00 PM
From: Tom D	Read Replies (4) \| Respond to of 164684

Why BKS and BGP cannot compete with AMZN... In brief, BKS and Borders use off-balance-sheet operating leases to finance most of their stores. Their true debt-to-market-capital ratios are around 60%. In recent years their return on invested capital exceeds their weighted average cost of capital-meaning that they are not creating value over time. This precludes a scorched-earth policy of deep discounting. Land-based competitors are also threatened by cannibalization from their own internet sites. I am unsure how much synergy exists between land-based stores and their internet counterparts since state laws require corporations which have a physical presence in a state to collect sales taxes. This means no URL's in stores. Please see my posting #1441 on this thread for more. Best Regards, Tom D