Amazon Stock Analysis - is Amazon's Stock a Good Buy Today? AMZN Stock Analysis | Summary and Q&A

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June 4, 2022
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Learn to Invest - Investors Grow
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Amazon Stock Analysis - is Amazon's Stock a Good Buy Today? AMZN Stock Analysis

TL;DR

This video provides an analysis of Amazon's business segments, recent developments including excess capacity and a write-down in their Rivian investment, and a fair value calculation for the stock.

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Questions & Answers

Q: What are the main business segments of Amazon?

Amazon's main business segments are online stores, third-party seller services, AWS, subscription services, advertising services, and physical stores.

Q: How has excess capacity affected Amazon's profit margins?

Excess capacity has led to lower profit margins for Amazon as they have to pay for square footage they don't currently need or use. However, it is expected that they will grow into this excess capacity in the long run.

Q: What impact did the write-down in the Rivian investment have on Amazon's earnings?

The write-down in the Rivian investment resulted in negative earnings per share of $7.56. However, if we exclude non-operational investments like Rivian, the adjusted earnings per share is positive at 4.24 cents.

Q: How has Amazon's revenue been trending in recent years?

Amazon's revenue has been growing rapidly, but there is a concern that revenue growth will gradually decline in the future.

Summary & Key Takeaways

  • Amazon's largest business segment is online stores, followed by third-party seller services, AWS (Amazon Web Services), subscription services, advertising services, and physical stores.

  • Recent developments include excess capacity in their distribution network, leading to lower profit margins, and a write-down in their investment in Rivian.

  • Amazon's revenue has been growing rapidly, but revenue growth is expected to gradually decline.

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