11 ms·
Yes I understand NPV and DCF but not OPs point. The eCommerce arm makes a lot of money so I don’t understand how you could come to the conclusion that its prese
by arcturus17 4y ago
Yes I understand NPV and DCF but not OPs point. The eCommerce arm makes a lot of money so I don’t understand how you could come to the conclusion that its present value is zero.
- diogofranco 4y agoIt made less than no money recently. You might be thinking of revenue.
- arcturus17 4y agoWhere are you getting this from? I cannot for the life of me find profits by business unit. I have glanced over the 2021 Annual Report but don't have to analyze it. If you have a source I would appreciate it.
- throwaway5752 4y agoI see what you're saying. The logic to the OP's point is "If AWS were to be spun out, on its own it should be worth 12x revenue, or $750B. If the Amazon web business were to be spun out on its own, it should be worth 6x revenue or $250B. Since those add up to $1T and the market cap of AMZN is $950B, the market assigns a -50B valuation to the rest of the company." I agree it's flawed logic. The market may just disagree with someone's sum-of-parts. It maybe conglomerate discount. It may be that the market is undervaluing AMZN, too. I don't think that many people would disagree AMZN's ecommerce division is valuable.