Is this another bubble collapsing?
Disclosure : I have a small short via ITM puts.
Recently a friend of mine mentioned AMZN on one of my facebook post about AAPL. I do not trade stocks much and I am certainly not an stock analyst nor do I “trade” on longer term views. However the conversation made me do a very basic research on AMZN. In short this is what I find:- AMZN annual revenue growth is about 40% per year based on last 3 years. On trailing 4 quarters basis it has flat lined and annual revenue growth rate is expected to be 20%-25%year on year. i.e. TOP LINE is not growing as fast as people expect(ed).
- AMZN net profits after all mumbo jumbo are flat to declining for last 3 years. On trailing 4 quarters basis, they are declining. i.e. BOTTOM LINE is under pressure.
- On trailing 12 months basis, the shares are trading on an amazing 2500+ PE. Even on Forward Earning estimate basis the shares are trading on 100+ PE.
