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  • Jun 20th, 2018 6:08 pm
Newbie
Oct 9, 2008
28 posts
10 upvotes
edmonton
There is a bit of kool aid being drank if you believe that getting amazon bonuses and stock options is an easy task, especially for a standard warehouse employee. I'm not an insider but i bet getting vested would take 1+ years.

I read this article a few months ago that gave me some good insight The Atlantic Article on Amazon Warehouses

I'm all for new jobs, and amazon does create jobs, but they are not "quality" jobs and they come at very large costs. Even on the tech side it is not one of the glamorous companies to work for.
Deal Addict
Mar 10, 2010
1734 posts
441 upvotes
Mark77 wrote:
Oct 28th, 2013 9:13 pm
How would we even value it at $20? They have no earnings. They are a very mature business. They are probably closer to their revenue peak than the 'market' believes.

There's tons of companies that can take $1 of capital and turn it into at least a few cents of annual recurring earnings when all items (depreciation, etc.) have been netted out. Amazon can't even accomplish that.

Yup. They've bamboozled non-technical-minded minded people into thinking that they have magic proprietary technology. But when you get right down to it, there's nothing unique about any Amazon product. They've invented nothing. They can't even seem to use their large scale and clout to extract higher than average margins. Amazon is more properly referred to as a cult, not a business.

Man, these estimates of Amazon not even worth $20 sure didn't turn out well
[OP]
Deal Addict
User avatar
Dec 14, 2010
4590 posts
3691 upvotes
Vitalogy80 wrote:
Apr 16th, 2018 5:39 pm
Man, these estimates of Amazon not even worth $20 sure didn't turn out well
That's the problem with using classic valuation metrics such as P/E to evaluate tech companies, because much of the future-oriented spending that most companies show as capex, and which is thus omitted from the income statement, comes directly out of income for tech since it’s called R&D.

Amazon has always followed operating cash flow rate, and that's how it should be valued. They never intended to have a profit, as Bezos wrote on his first letter to shareholder, he will always prefer cash flow over gaap metrics.


Rod
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Deal Addict
Aug 19, 2016
1504 posts
549 upvotes
rodbarc wrote:
Apr 17th, 2018 10:38 am
That's the problem with using classic valuation metrics such as P/E to evaluate tech companies, because much of the future-oriented spending that most companies show as capex, and which is thus omitted from the income statement, comes directly out of income for tech since it’s called R&D.

Amazon has always followed operating cash flow rate, and that's how it should be valued. They never intended to have a profit, as Bezos wrote on his first letter to shareholder, he will always prefer cash flow over gaap metrics.


Rod
Yeah, since we can't capitalize on R&D (Amazon calls it Technology and Content) and write it off over time, it got directly charged to income statement as expenses. That is why we see low PE. However, the money spent on R&D has future benefits of generation revenue. Therefore, that is what Jeff meant by cash flow.

As Warren Buffett have pointed out, PE ratio is not the sole metric you use in evaluating a company especially when the accounting rules is now super strict.

You can't use PE ratio as a metric going forward for those companies that have investments in the stocks & bonds market, especially the banks.
Deal Addict
Aug 19, 2016
1504 posts
549 upvotes
I just found out that not only Amazon offers $2,000 for employees who wish to resign, they also have a 95% tuition paid program (I believe it is call Career Choice Program).

In this program, all the hourly wage workers such as those working in the fulfillment centers are able to enroll in school programs that would get you an in demand skill. Even if those skills aren't useful at Amazon, they will still qualify.

Heck, I haven't seem a place where the company will pay tuition for those low skill workers to obtain skills that aren't useful to the company. I only see where the companies will pay for the tuition if you enroll in something that would benefit the company. A friend of mine was forced to stay for a year after he got his CGA with company paid tuition.

Now you know why people are lining up to "pee in the bottles". I doubt this claim is true.
Deal Addict
Jul 30, 2015
1528 posts
607 upvotes
Toronto, ON
Dumping money into AMZN yesterday really paid off! Talk about being lucky.
Deal Addict
Aug 19, 2016
1504 posts
549 upvotes
It appears that my curse has been lifted, early.

Just a recap, I have 100% of my net worth in Amazon. And I have sold 20 shares to finance a car purchase earlier.
Deal Addict
May 22, 2003
2603 posts
1160 upvotes
Vancouver
Collegegraduate - I'm long Amazon too, but no way I could hold 100% of my networth in 1 stock! Congrats to you though!
Deal Addict
Aug 19, 2016
1504 posts
549 upvotes
notenoughsleep wrote:
Apr 26th, 2018 4:20 pm
Collegegraduate - I'm long Amazon too, but no way I could hold 100% of my networth in 1 stock! Congrats to you though!
I have missed the opportunity on Berkshire, and Microsoft. I will not miss this boat.
Well, I wasn't born when Berkshire became public (was negative 20 years old), and I was like 2 years old when Microsoft became public.
Amazon became public when I turned 13. I am lucky to be on the boat.

I know Berkshire and Microsoft very well, but I don't see the same things as I see in Amazon.

If you find something good in life, grab on to it and never let it go.
Too much of a good thing can be wonderful as Warren Buffett puts it.
Deal Addict
Jun 3, 2009
4082 posts
530 upvotes
Montreal
CollegeGraduate wrote:
Apr 26th, 2018 4:44 pm
I have missed the opportunity on Berkshire, and Microsoft. I will not miss this boat.
Well, I wasn't born when Berkshire became public (was negative 20 years old), and I was like 2 years old when Microsoft became public.
Amazon became public when I turned 13. I am lucky to be on the boat.

I know Berkshire and Microsoft very well, but I don't see the same things as I see in Amazon.

If you find something good in life, grab on to it and never let it go.
Too much of a good thing can be wonderful as Warren Buffett puts it.
Well done sir! I was hoping for a post ER dip to initiate a position though.
Deal Addict
Aug 19, 2016
1504 posts
549 upvotes
cn_habs wrote:
Apr 26th, 2018 5:48 pm
Well done sir! I was hoping for a post ER dip to initiate a position though.
I wish it to dip as well. I just got paid and can afford 1 more share of AMZN. It is selling like $1,900+ CAD.
Deal Addict
May 22, 2003
2603 posts
1160 upvotes
Vancouver
It's tempting to put more into Amazon, but it currently makes up 5% of my portfolio already.
Deal Addict
Feb 4, 2015
3220 posts
661 upvotes
Canada, Eh!!
Sold half position... want to allocate more funds to non-tech stocks

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