Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Glenn D. Rudolph who wrote (14018)	8/19/1998 8:52:00 PM
From: Glenn D. Rudolph	Respond to of 164684

A good post from TMF on AOL: Subject: Re: Time to Buy Date: Tue, Aug 18, 1998 2:35 AM From: ArcheLogos Message-id: <1998081806350400.CAA24686@ladder03.news.aol.com> <<< Every time this board gets full of bears and negative posts on how the stock has turned, does not act well, add in this case, market was up, it always seem time to start buying again. Shorts try and scare you into thinking time to get out, etc etc while the fundamentals are hugely positive for the Internet. >>> Fundamentals are terrible for Internet companies. Let me ask you, have you been investing for less than three years? Do you know accounting principles? I do. I worked at a public accounting firm for 9 years. Do you know that Amazon will not report a profit in the next two years? That's poor fundamentals. Did you know they don't make money off Internet advertising -- they pay for advertising on the portal sites. They are on the spending end of the deals. How about Bertelsmann coming online in America this year -- just announced Friday. Did you know that Amazon said in their 10Q that their losses will increase in the forseeable future? Did you know they also said sales increases will slow as competition sets in from Barnes and Noble and Bertelsmann. Their 10Q was released the same day Bertelsmann announced going online in America with books, tapes, CD's, etc. Let's talk about stock trading. Did you know also that the buys on Amazon have been small blocks compared to the former big blocks that were formerly purchased by managed accounts? Or that every attempted rally the stock makes is followed up by larger blocks of selling? How about news. All the positive news has come out on the stock. What's left to drive the price up after the stock now trades at 40 times sales? -- sales that yield no earnings in a low margin business. Perhaps the Bertelsmann news will drive the price up. Oh, how about InterVarsity or Varsity books (can't remember exact name) going online and offering student services for college textbook selection and delivery? Will these events be profitable for Amazon? The news that will surely follow will not be positive. Wall Street journal will probably issue a warning any day now about the dangers of staying long in this stock. Once brokerage firms start getting their clients out -- many already have -- it'll be time for downgrades on the stock. I ask you, will you wait for this ticking time bomb to occur? Or will you get out now with your money and your profits before the persuasion takes full effect. Rally couldn't get past 135. Sells down on every two point rise -- even on an up Nasdaq day. July is old news, pal. Increased usage means nothing for future months when other online booksellers will drive down the price of books. Bigger booksellers can absorb admin. costs -- Amazon can't. In order to increase sales and beat the competition in sales, they'll have to spend more than they can profit to boost sales. They warned in their 10Q that the future was negative. I once said that people can't move the stock on these message boards. We just don't have the capital compared to what really moves the stock. What, a total of 10,000 shares owned on this board? That can't move a stock. There's no reason for a bear to scare the longs out of their position. It's about opinions. I know from experience on these high-flyers that it's "buy the rumor, sell the fact." If you look at the last run-up in Internet stocks in late 1995 with Spyglass, CMG Information, Quarterdeck, and Netcom, the stocks went up to 70 to 90 per share and then fell months later down in the teens (Spyglass down to $5) and a lot of people were hurt. Look at their charts by clicking the green arrow on AOL, then click Historical Quotes and run a Custom Graph from dates 1/1/95 through 1/1/97. These are the symbols: SPYG, QDEK, CMGI, NETC. Fallen kingdoms they are; crushed idols; has-beens who took down their victims who fell prey to the seduction of momentum. I counsel you to not follow after them.