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

To: Glenn D. Rudolph who wrote (15525)	9/1/1998 8:23:00 AM
From: H James Morris	Respond to of 164684

Glen< Dulles, Virginia, Aug. 31 (Bloomberg) -- America Online Inc., Amazon.com Inc. and other Internet-related shares plunged, some posting their biggest one-day losses ever, amid concern that the stocks have risen too high given their earnings prospects. AOL, the No. 1 online service, tumbled 14 5/16 to 81 15/16 in trading of 14.1 million. The drop trimmed AOL's market value by $3.09 billion today and by almost $12 billion since last month, when the shares reached a high of 136 1/8. Amazon.com plunged 22 9/64 to 83 3/4, its biggest one-day percentage drop. Few companies that do business on the global computer network have ever made money. That didn't stop investors from snapping up the shares earlier this year on optimism that revenue from electronic commerce and online advertising would mushroom. Now, with U.S. economic growth slowing, investors have become skeptical that the companies will become profitable anytime soon. ''These companies are speculative and there are no fundamentals such as earnings to fall back on,'' said Ryan Jacob, portfolio manager of the Internet Fund. He said he's not selling any of his holdings, which include America Online, Amazon.com and Yahoo! Inc. because he's a long-term investor. Even though most Internet companies are losing money, investors have pushed them to higher valuations than well- established companies with track records of profits and steady revenue. Dulles, Virginia-based America Online, one of the few Internet companies to have made a profit, trades at about 82 times its expected per-share earnings for 1999 and had sales of $1.69 billion in fiscal 1997. A price-earnings ratio is a common measure of the value of a stock. By comparison, shares of Coca-Cola Co., world's largest soda maker, trade at about 41 times its expected 1999 earnings. Coca- Cola had revenue of more than $18 billion last year. Amazon Seattle-based Amazon.com, the No. 1 online bookseller, has a market value greater than those of bricks-and-mortar booksellers Barnes & Noble Inc. and Borders Group Inc. combined. Amazon's market value has swelled even though its losses have widened and its sales were $147.8 million last year, compared with $2.45 billion for Barnes & Noble and $1.96 billion for Borders. ''The last couple of days have been brutal,'' said Roger McNamee, a partner at Integral Capital Partners in Menlo Park, California, which owns technology stocks including Amazon. ''You're still a ways off from most of the Internet stocks' bottoms.'' > I guess the question is, what will be the bottom? My prediction is, $18ps.