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Lowered Estimates — Again

Amazon had earnings estimates lowered once again. Whew, the numbers are almost all red.

One Year Chart

Just a couple of green spots in the one-year chart. P/E’s 140. Investors are betting on more profits coming in later years from the Kindle Fire.

AMZN fell after reporting earnings last quarter, but sales rose 35%. Sales figures missed analyst targets. Amazon also lowered this quarter’s estimates. Its just keeps getting worse. Get used to it, AMZN’s been doing this a lot lately.

Earnings Table

The earnings table is covered in red. Yes the company beat last quarter, but those estimates had been slashed the prior three quarters.

Looking three and four quarters out, profit growth is expected to come back but I can’t place a lot of hope in that since estimates have been declining so rapidly.

Bottom Line

AMZN is investing in its infrastruture overseas this year and is selling Kindle Fires so cheap that profits on the device are slim to none. This is a long-term story. Until we have a grasp of what AMZN can earn in future years, this is a speculative investment.

View the Fair Value here.
View the Ten-Year Chart here.

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