Amazon (AMZN) / Jeff Bezos

[winston]

not vested

Amazon Slumps After Weak Holiday Quarter, Muted Outlook

Posted weaker-than-expected fourth quarter earnings and a muted near-term outlook.

Amazon said online sales fell 2.3% from last year to to $64.53 billion, suggesting weakening consumer spending over the final months of the year, although overall revenues of $149.2 billion came in firmly ahead of Street forecasts.

Amazon Web Services contributed $21.38 billion, rising 202.% from last year, a similar pace of growth recorded over the three months ending in September but just inside the Street forecast of around $22 billion.

Looking into the current quarter, Amazon said it sees operating income of between zero and $4 billion on revenues in the range of $121 billion to $126 billion, compared to the Refinitiv forecast of around $125.1billion.

Source: The Street

[winston]

not vested

Amazon.com, Inc. (AMZN) – Announced Thursday, February 2

Amazon rounded out its fiscal year 2022 with a mixed fourth quarter.

The company reported adjusted earnings of $0.03 per share, which came in below analysts’ estimates for earnings of $0.15 per share.

Revenue rose 7.9% year-over-year to $149.2 billion, well above analysts’ projections for revenue of $145.37 billion.

This compares to earnings of $1.39 per share and revenue of $137.4 billion in the same quarter of last year.

Amazon Web Services (AWS) revenue increased 20% year-over-year to $21.3 billion, just shy of analysts’ estimates for $21.76 billion.

Total sales for fiscal year 2022 came in at $514 billion, up 9% compared to $469.8 billion in 2021.

For full-year 2023, revenue is expected to jump to $556.57 billion.

For the first quarter of 2023, Amazon anticipates that revenue will rise between 4% and 8% to $121 billion and $126 billion, with growth driven by Amazon’s need to make customers’ lives better and easier every day.

Earnings per share are forecast to come in at $1.58, down from earnings per share of $3.24 a year ago.

CEO Andy Jassy said in a statement that “in the short term, we face an uncertain economy, but we remain quite optimistic about the long-term opportunities for Amazon.”

AMZN shares fell more than 6% on Friday in the wake of its earnings results.

Source: Market 360

[winston]

AMAZON INC (AMZN US)

Recommendation : BUY
Fair Value : USD 150.00

MIXED OUTLOOK IN FY23, BUT MORE CONFIDENT OF RECOVERY ON PROFITS.

Non-AWS business (e-commerce, advertising) seeing better margins on cost efficiencies
More growth drivers emerging within the non-AWS business segments in FY23
AWS growth continues to slow down as industry headwinds continue
Long-term investment thesis intact, and financials should improve in FY23. Upgrade FV to USD150

Amazon.com Inc (AMZN, stock code: AMZN US) is well-positioned as a market leader in e-commerce and public cloud businesses, where the secular trends remain in early to mid-stages and growth continues to be strong.

We expect AMZN’s e-commerce profit to recover over the next 2 years on the back of stronger focus on cost control and more conservative CAPEX plans by the management.

Amazon Web Services (AWS) continues to enjoy structural growth, driven by higher penetration of IT spending into public cloud segment.

We favour AMZN as an earnings turnaround and structural growth play over the long term. AMZN’s customer proposition and wide network reach with their Prime app and businesses offer new opportunities for growth.

While the share price should trend towards our fair value (FV) over the long term, we are cognizant of the possibility of near-term volatility given an unstable macro background and believe that long term investors should gradually add exposure on weakness ahead.

Source: OCBC

[winston]

not vested

Amazon Inc. – Longer term remains attractive
PSR Recommendation: ACCUMULATE
Target Price: 117

Revenue was in line with expectations at 101% of our FY22 forecast; while earnings were a slight miss with normalized PATMI at 96%, excluding a pre-tax valuation loss of US$12.7bn from Rivian Automotive, due to higher-than-expected operating expenses.

4Q22 revenue grew 8.6% YoY, beating top-end company guidance with advertising continuing to buck the industry’s declining trend.

AWS remains the fastest growing segment but growth is expected to decelerate to mid-teens in 1Q23.

We upgrade to ACCUMULATE with a raised DCF target price of US$117.00 (prev. US$108.00) using a WACC of 6.4% and terminal growth rate of 5%.

We expect near-term challenges for revenue growth as consumers are more selective in their discretionary spending and AWS customers opt for lower-cost products.

However, we expect growth to reaccelerate in FY24e, particularly for AWS as Amazon increases its client base and customers scale up their computing demand as macro improves.

Source: Phillips

https://www.stocksbnb.com/reports/amazo ... ttractive/

[behappyalways]

Amazon 'Pauses' HQ2 Construction In Virginia Amid Sweeping Job Cuts
https://www.zerohedge.com/political/ama ... g-job-cuts

[winston]

not vested

Amazon now ‘solidly a top pick’ at Goldman Sachs

Concerns of an AWS slowdown are overwrought while e-commerce margins look as though they will improve into 2023.

Source: Seeking Alpha

https://seekingalpha.com/news/3944824-a ... _breakfast

[winston]

not vested

This Stock is Offering an Excellent Entry Point (and the Market is Sleeping On It)

Amazon has been looking to make a mark in healthcare. The company’s ventures haven’t always been highly successful.

Source: The Motley Fool

https://tradesoftheday.com/2023/03/16/t ... ing-on-it/

[behappyalways]

Amazon Prepares To Fire Another 9,000 Workers
https://www.zerohedge.com/markets/amazo ... 00-workers

[winston]

not vested

Amazon

The biggest headwind Amazon is currently contending with is the growing likelihood that the U.S. will fall into a recession at some point within the next year.

But here’s the interesting thing about Amazon that far too many investors may be overlooking: Even though online retail sales accounts for a significant percentage of Amazon’s total sales, it’s a relatively small percentage of cash flow and operating income.

Three of Amazon’s ancillary segments are responsible for most of its cash-flow generation, and they’re all continuing to grow by a sustained double-digit rate.

Amazon Web Services (AWS) is easily the company’s most valuable operating segment from the standpoint of cash flow and future profits. AWS accounts for close to a third of the world’s cloud infrastructure spending, which is an enviable position to be in with enterprise cloud spending still in its infancy. Despite AWS generating around a sixth of Amazon’s annual sales, it’s consistently producing more than half of the company’s operating income.

The second key ancillary division is advertising services. The company’s leading online marketplace draws well over 2 billion monthly visitors. Merchants wanting to target their products or message(s) are wisely advertising with Amazon. Excluding currency fluctuations, advertising services saw year-over-year sales growth of 21% to 30% over the past four quarters.

The third segment of importance is subscription services. Amazon announced nearly two years ago that it had surpassed 200 million Prime members globally, but it hasn’t updated this figure since. Considering that the company holds the exclusive rights to Thursday Night Football and garners more than 2 billion visits each month, it’s a fair assumption this figure has increased. Subscription services are bringing in close to $37 billion in annual run-rate sales.

While Amazon isn’t cheap based on the traditional price-to-earnings ratio, it’s cheaper than it’s ever been as a publicly traded company relative to Wall Street’s future cash flow forecast.

Source: Daily Trade Alert

[winston]

not vested

Amazon

The reason Amazon lost as much as half of its value since hitting an all-time high, was the expectation that online sales would slow due to both the ongoing bear market in stocks and the growing likelihood of a U.S. recession.

E-commerce is a generally low-margin operating segment that serves a more important purpose as a jumping-off point to the ancillary segments that generate the bulk of its cash flow and profits.

Amazon Web Services (AWS), - 32% of all cloud infrastructure service spending during the fourth quarter.

Even though AWS generates about a sixth of Amazon’s net sales, it’s consistently responsible for 50% to 100% of the company’s operating cash flow.

The popularity of Amazon’s low-margin online marketplace has also been the springboard for the success of its subscription services segment. In April 2021, Amazon announced it had surpassed 200 million global Prime subscribers.

With modest growth in its marketplace since then, along with gaining the exclusive rights to Thursday Night Football, it’s extremely likely the company’s subscriber count has continued to climb.

The point is that even if Amazon’s online retail sales stagnate or fall, it could still deliver sustained, double-digit cash flow growth thanks to its higher-margin ancillary operations.

Since Amazon reinvests most of its cash flow back into its business, cash flow is a better measure of “value” than the traditional price-to-earnings (P/E) ratio.

Right now, Amazon is cheaper than it’s ever been relative to Wall Street’s future cash flow projections for the company.

Source: Daily Trade Alert