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Some interesting observations about Amazon's P/E ratio here http://www.mondaynote.com/2012/05/27/decoding-share-prices-amazon-apple-and-facebook/ http://www.mon
by loumf 14y ago
Some interesting observations about Amazon's P/E ratio here http://www.mondaynote.com/2012/05/27/decoding-share-prices-amazon-apple-and-facebook/ http://www.mondaynote.com/2012/05/27/decoding-share-prices-a... on Jean-Louis Gassée's "Monday Note".
Basically, Amazon forgoes profit to get market share, will push out all competitors, build a huge barrier to entry with excellent execution and logistics, and then raise prices to increase profit. Traders are buying now and holding until that happens.
- gamble 14y agoSupposedly. Everyone has been waiting for the big payoff since the 90s, but Amazon remains a stubbornly low-margin retailer. Eventually people are going to be forced to face the fact that there is no sinister Phase 2. Amazon is just happy being a low-margin, high-volume Walmart-of-the-Internet with little interest in its investors.