The medium term support area around 1495.46 USD should allow Amazon.com shares to re-establish an upward trend in the short term.
Summary
● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
● In a short-term perspective, the company has interesting fundamentals.
Strengths
● The close medium term support offers good timing for purchasing the stock.
● According to sales estimates from analysts polled by Thomson-Reuters, the company is among the best with regard to growth.
● The company is in a robust financial situation considering its net cash and margin position.
● The group usually releases upbeat results with huge surprise rates.
● For the past twelve months, EPS forecast has been revised upwards.
● For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
● Analysts covering this company mostly recommend stock overweighting or purchase.
● The difference between current prices and the average target price is rather important and implies a significant appreciation potential for the stock.
Weaknesses
● Prospects from analysts covering the stock are not consistent. Such dispersed sales estimates confirm the poor visibility into the group's activity.
● The company's enterprise value to sales, at 3.15 times its current sales, is high.
● With an expected P/E ratio at 77.79 and 57.36 respectively for both the current and next fiscal years, the company operates with high earnings multiples.
● Revenue estimates are regularly revised downwards for the current and coming years.
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Amazon.com, Inc. is one of the world leaders in on-line distribution of products to the general public. The group also operates a marketplace activity, allowing individuals and distribution companies to conduct their purchase and selling transactions for goods and services. The activity is organized around three families of products and services:
- electronic and computer products: toys, cameras, computers, laptops and peripherals, TVs, stereo systems, readers, wireless communication products, etc. Amazon.com also offers kitchen and garden equipment, clothing, beauty products, etc.;
- cultural products: books, musical products, video games and DVDs;
- other: primarily Internet interface and application development services.
Net sales break down by source of income between sales of services (55.5%) and sales of products (44.5%).
Net sales are distributed geographically as follows: the United States (68.8%), Germany (6.5%), the United Kingdom (5.9%), Japan (4.5%), and other (14.3%).