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

To: Skeeter Bug who wrote (17289)	9/16/1998 1:31:00 AM
From: OtherChap	Read Replies (4) \| Respond to of 164684

Just released- Amazon has a NEGATIVE book value. Wonder how this relavation will affect the stock price tomorrow? Plus the inevitable earnings warning they will HAVE to issue in the next few days, since every analyst suddenly "magically and silently" doubled their loss estimates for AMZN last week. Hot off the presses from MSNBC in a story about junk bonds: ********************* In this universe of shaky businesses, Amazon.com has a special problem. Though its balance sheet showed shareholder equity (the excess of assets over liabilities) of $39.4 million as of June 30th, the company's tangible net worth - which is all that fixed income investors really care about (shareholder equity minus goodwill and purchased intangibles) - is actually a negative $13 million. ********************* My comment- GOD BLESS AMERICA.. Where else can an ex-hedge fund manager run a company that has assets of -$13 million, has never earned a dime of profit, yet commands a market cap of 7 billion dollars? (oops, 3 1/2 billion now) If I can't be a part of this charade as an insider, at least I can make a fortune when their stock drops through the floor! This fiasco ranks behind only BRE-X and BOST and PRESTEK in my opinion. (well, bre-x is similar mainly because of the amount of shareholder equity that was lost in a remarkably short period of time)

To: Skeeter Bug who wrote (17289)	9/16/1998 1:50:00 AM
From: H James Morris	Read Replies (1) \| Respond to of 164684

Morgan Stanley, I just can't get enough of Morgan Stanley. <In the deal, Amazon's underwriter, Morgan Stanley Dean Witter & Co., sold $530 million worth of 10-year notes at a startling 38.5 percent discount from their face value - meaning that Amazon received (net of fees to the underwriter), less than $320 million from the offering. Of course, come May of 2008, when the notes mature, Amazon will have to pay back all $530 million, which includes the $210 million it never received in the first place. ÿ ÿ ÿ ÿWhy pay back more than it received? Because that was the only way the notes could be sold at all. Since Amazon.com couldn't afford the cash drain of interest payments on the notes, Morgan Stanley structured the deal to be free of payment (the interest would simply "accrue") for the first five years, with the notes paying 10 percent annually thereafter until maturity. With the steep payment at maturity, Amazon.com has simply pushed off the day of reckoning in the hopes that its business prospects will brighten enough by then to pay off, or refinance, the deal.