Amazon.com, Inc. : A support level that should be taken advantage of
Published on 10/29/2018
at 07:37 pm IST
Share
BUY
Stop-loss triggered
Entry price
Target
Stop-loss
Potential
$1,641.35
$1,777
$1,577
+8.26%
The technical support around 1569.68 USD emanating from daily closing prices could trigger a technical rebound for Amazon.com shares.
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 share is getting closer to its long-term support in weekly data, at USD 1574.37, which offers good timing for buyers.
● The close medium term support offers good timing for purchasing the stock.
● Analysts expect a sharply increasing business volume for the group, with high growth rates in the coming years.
● 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 last week, the earnings per share forecast has been revised upwards. According to recent estimates, analysts give a positive overview of the stock
● For the last 4 months, the company has been enjoying highly positive EPS revisions, which were frequently and significantly raised.
● 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.
● Within the weekly time frame the stock shows a bullish technical configuration above the support level at 1574.37 USD
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 3.4 times its current sales, is high.
● The company's valuation in terms of earnings multiples is rather high. Indeed, the firm is getting paid 87.31 times its estimated earnings per share for the ongoing year.
● For the last four months, the sales outlook for the coming years has been revised downwards. No recovery of the group's activities is yet foreseen.
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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 (58.7%) and sales of products (41.3%).
Net sales are distributed geographically as follows: the United States (68.3%), Germany (6.4%), United Kingdom (6%), Japan (4.3%) and others (15%).
This super rating is the result of a weighted average of the rankings based on the following ratings: Global Valuation (Composite), EPS Revisions (4 months), and Visibility (Composite). We recommend that you carefully review the associated descriptions.
Investor
Investor
This super composite rating is the result of a weighted average of the rankings based on the following ratings: Fundamentals (Composite), Global Valuation (Composite), EPS Revisions (1 year), and Visibility (Composite). We recommend that you carefully review the associated descriptions.
Global
Global
This composite rating is the result of an average of the rankings based on the following ratings: Fundamentals (Composite), Valuation (Composite), Financial Estimates Revisions (Composite), Consensus (Composite), and Visibility (Composite). The company must be covered by at least 4 of these 5 ratings for the calculation to be performed. We recommend that you carefully review the associated descriptions.
Quality
Quality
This composite rating is the result of an average of the rankings based on the following ratings: Capital Efficiency (Composite), Quality of Financial Reporting (Composite), and Financial Health (Composite). The company must be covered by at least 2 of these 3 ratings for the calculation to be performed. We recommend that you carefully review the associated descriptions.
