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

To: Gary Walker who wrote (23754)	10/29/1998 6:41:00 PM
From: Tom D	Read Replies (1) \| Respond to of 164684

re: Barriers to entry The barriers to entry are: 1) You must be ready to sell at a loss and lose $500M in the first few years if you want to compete with AMZN. 2) AMZN already has captured a lot of the easy customers when there was no competition. They have built loyalty through service to their customers. Before the cynics attack the loyalty issue, let them explain how AMZN kicked CDNW's butt in their first full quarter of selling music CD's. If there are no barriers to entry, maybe they can explain how BKS has managed to accomplish so little with their website after 15 months of trying. Round 1 in the etailing wars clearly goes to AMZN. There will be a round 2, involving Bertlesmann, and maybe Wal-Mart, and maybe MSFT? and maybe others. Meanwhile, AMZN gains more experience and more market share. Best Regards, Tom

To: Gary Walker who wrote (23754)	10/29/1998 11:00:00 PM
From: Don Westermeyer	Read Replies (1) \| Respond to of 164684

Obviously betting against this beast is not a smart move at this point. Well, I don't see anything over the next few months that would pop this balloon. I see they played 'beat the earnings' game pretty well. I read that the original estimate as ($0.08). Good thing the analysts pushed the bar significantly lower. I've been reading 'Market Rap' at stocksite.com mostly to keep me sober in what I see is the almost most expensive market in history (another 2% on the S&P will top July on a P/E basis). Here's what he had to say about AMZN (bulls do not read any further) ********************************************************************** The overnight markets were quiet last night, but who cares anyway because the rest of the world doesn't matter to us. We are Wall Street and on Wall Street we don't care about fundamentals, we don't care about earnings, we don't care about anything. ALL WE CARE ABOUT IS OUR GAME CALLED "Beat the Number." Last night's insult to our intelligence was Amazon.com. Forget about the fact that the number was way worse than people expected, because the SEC is cracking down on the nonsense in merger accounting land. Amazon.com "beat" the number as it lost less then it was supposed to; for example, the "surprise" charges. This is just one of the tactics in the play book of Beat the Number. It's called Move the Bar. The original estimate for this quarter was about an 8-cent loss. That was bumped to 25 cents, then into the 40s and, most recently, was adjusted to a 57-cent loss. Well, because the company lost less than expected, it gets to "beat" the number. Even the New York Times missed this, saying that there was an improvement because it was less of a loss. What they forgot to say was that it was relative to most recent expectations. At least the Wall Street Journal was able to identify this. Here is a list of the earnings progress since Amazon.com came public. If the company ever could have a really bad quarter and lose a few bucks a share, its stock could surge to $300. You have to love a business that sells dollar bills for $.95. 3/97 ($.08) 6/97 ($.16) 9/97 ($.185) 12/97 ($.205) 3/98 ($.20) 6/98 ($.44) 9/98 ($.90) I have nothing personal against Amazon.com or any of the other companies that I speak pejoratively about. My objection is the monstrous discrepancy between the value of the business, the fundamentals and the prospective rates of returns for the business. I think that Amazon.com is a fine product to use, but the market has bid up the stock price to where it has no relationship to the business. I'm sure many of the shareholders have no notion of how business works, they just like the idea or the chart. (I know this is true for many companies because of the questions people ask me. Individuals rarely even know the market cap.)