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

To: Glenn D. Rudolph who wrote (30099)	12/16/1998 1:25:00 PM
From: Mark Fowler	Read Replies (3) \| Respond to of 164684

Dow Jones Online News, Wednesday, December 16, 1998 at 12:22 NEW YORK -(Dow Jones)- Shares of Amazon.com Inc. jumped Wednesday after CIBC Oppenheimer analyst Henry Blodget lifted his long-term price target on the Internet-based retailer to $400 from $150. The rally in the company's shares helped fuel typical gains in other Web-related stocks. At late morning, Amazon.com shares (AMZN) were up $46, or 19%, at $288.75 on trading volume of 8.4 million shares, making it one of the most actively traded issue on the Nasdaq stock market. Blodget said he believes Amazon.com "is in the early stages of building a global electronic-retailing franchise that could generate $10 billion in revenue and earnings-per-share of $10 within five years." The analyst said he believes that while Amazon.com's stock is "incredibly expensive relative to near-term expectations" and "scary to buy," the company's long-term opportunity is large enough to support a market capitalization much higher than current levels. The analyst pointed out that Amazon's revenue is currently growing faster than 300% per year. He added that the company's operating margins could ultimately exceed 10% "if the promise of digital delivery of music, books, software and other products comes closer to reality over the next several years." Blodget, who continues to rate the stock a "buy," said the shares recently passed his price target of $150. The time horizon on Blodget's new price target wasn't immediately available. He noted that, since he initiated coverage on Amazon.com three months ago, the company has reported third-quarter results that beat expectations and has become the largest online music retailer only one quarter after opening its online music store. The company has also continued to expand the types of products it sells to include videos and gifts, and has introduced a comparison-shopping service and the "GiftClick" service, which allows customers to send gifts by clicking on the recipient's e-mail address. Amazon.com indicated that the number of orders on the day after Thanksgiving this year was four times greater than a year earlier, Blodget added. Blodget said he believes the adoption of electronic commerce is lagging online access by a year or more - suggesting that the rapid growth of the Internet over the past few years will drive strong growth in online commerce in the years ahead. He therefore believes that Amazon's stock is in earlier part of its growth cycle than other high-profile Internet stocks like Yahoo! Inc. and America Online Inc. Amazon has yet to prove that it will ever make money, which has led to enormous controversy around its stock valuation. But Blodget maintained that Amazon "will one day make a lot of money" and said that if his aggressive growth scenario stays on track over the next 12 months, the stock's upward momentum shouldn't reverse itself. The strength in Amazon's stock lifted the shares of a number of other electronic-commerce stocks Wednesday despitre a generally weak broader market. Shares of computer-products retailer Egghead.com Inc. (EGGS) were up 7%, and shares of online auction operator eBay Inc. (EBAY) were up 11% at late morning. Even shares of Amazon's fiercest competitor in the online bookselling business, Barnes & Noble Inc. (BKS), were up 5%. Elsewhere, shares of Creative Computers Inc. (MALL) rose 7%, Peapod Inc. (PPOD) climbed 4%, and Preview Travel Inc. rose 3%. Another contributor to the e-commerce group's ascension is America Online Inc. (AOL), said Volpe Brown & Whelan Co. analyst Derek Brown. The Internet-access provider said Wednesday its 1998 holiday shopping traffic has been 3.5 times above last year's levels. Such vigorous holiday growth in online business is an important indicator that doing business over the Internet is becoming more acceptable among mainstream consumers, Brown said. America Online shares were up 5% at late morning. Meanwhile, Keith Benjamin, an analyst with BancBoston Robertson Stephens, said Oppenheimer analyst Blodget's new price target on Amazon.com is the likely catalyst behind the e-commerce sector movement Wednesday. He cautioned however, that online retail stocks "seem to be easily swayed when there's any kind of news." Benjamin added that, while there's no way as yet of measuring the potential growth of commerce on the Net, expecting such staggering price growth, even from a sector leader, may be a little impetuous. "Trying to justify a $400 price target is an irresponsible exercise in my view," Benjamin warned. Copyright (c) 1998 Dow Jones & Company, Inc. All Rights Reserved.

To: Glenn D. Rudolph who wrote (30099)	12/16/1998 2:32:00 PM
From: SLN	Read Replies (1) \| Respond to of 164684

Glen and others, Although I rarely post, this is one that I feel I must put in writing. If you go to the following site, you will note that Oppenheimer's analyst is somewhat pulling the wool over the trader's eyes. companies.netscape.com What is important, his price target of $400 is an amalgamation of two different models. His first model reflects a target of $500 based upon revenues in the year 2000, THREE years from now. His second model suggests a target of $300 based upon anticipated earnings FIVE years from now. He combines the two to come up with a price target of $400. What he does not tell you is that the target is for either THREE or FIVE years from now, not twelve months. Thought you'd find this of interest.