Cold Turkey Is A Lot Bigger Than Anatolia

You know that the end is near when the only thing the punters can find to buy during a day of market turmoil is the handful of already absurdly over-valued momo stocks. And they didn’t even mess around with the also-rans, but charged right into Amazon (AMZN) and lifted it by another $10 billion.

Yes, in some universe other than this one, valuing a quarter-century old company that now has profitless predation wired into its DNA might makes sense at 106X LTM free cash flow and 148X net income. But what doesn’t make an iota of sense in any universe is the message conveyed in the chart below.

To wit, during the last 19 months AMZN has essentially done nothing new except the same old, same old. For instance, it crashed into the grocery business per the Whole Foods deal and then promptly slashed its whole paycheck prices, thereby goosing sales. But that action also vaporized Whole Foods’ already razor thing operating margin of 2.9% ($459 million on $16 billion in sales), thereby giving AMZN still another “growth” vertical which pukes red-ink.



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