Amazon updated December 28, 2016

Amazon is updated and remains rated Sell, now at $771.

This company is not well suited to fundamental analysis because its earnings are still low in relation to its stock price. Nevertheless, I wanted to provide some knowledge of the fundamentals of this company. It has probably always looked vastly over-valued based on fundamentals. But those who had faith in it as a growth stock have been rewarded. The company is just completing its 22cnd year and at some point the P/E multiple needs to decline as the earnings either catch up to the share price or the share price possibly declines. But perhaps that day is still some years off. I can not justify buying Amazon based on fundamentals. But that does not mean that it can’t continue to rise. If I owned it I would Sell and and/or make sure that I held only a modest position as a speculative pick.

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