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Amazon is a pretty mature company and has had a P/E ratio above 100 for most of the past 5 years. With the new monetary regime, more companies may get that type

Amazon is a pretty mature company and has had a P/E ratio above 100 for most of the past 5 years. With the new monetary regime, more companies may get that type of profile.

Retric 6y ago
Amazon is still seeing 20+% annual revenue growth rates. That’s not what a mature company looks like. Amazon revenue for the twelve months ending June 30, 2020 was $321.782B, a 27.66% increase year-over-year. Amazon annual revenue for 2019 was $280.522B, a 20.45% increase from 2018. Amazon annual revenue for 2018 was $232.887B, a 30.93% increase from 2017. Amazon annual revenue for 2017 was $177.866B, a 30.8% increase from 2016. https://www.macrotrends.net/stocks/charts/AMZN/amazon/revenue https://www.macrotrends.net/stocks/charts/AMZN/amazon/revenu... By comparison Walmart’s revenue for 2018 was $500.343B and it hit $542.026B for the twelve months ending July 31, 2020. https://www.macrotrends.net/stocks/charts/WMT/walmart/revenue https://www.macrotrends.net/stocks/charts/WMT/walmart/revenu...
MrPowers 6y ago
Your comment seems to imply a causal relationship between monetary policy and stock valuations, which is the type of relationship economists investigate: https://www.researchgate.net/publication/322006131_A_Study_on_the_Relationship_between_Monetary_Policy_Variables_and_Stock_Market https://www.researchgate.net/publication/322006131_A_Study_o... I don't know enough about the data to have an opinion. I do know that there are times in history when companies have sustained P/E ratios above 100 for many years (see Japan in the 1980s). You might be right, but from what I've seen, 100x P/E ratios usually come back down to earth.