People disagreeing on all just about everything, yeah,
Makes you stop and all wonder why.
Why only yesterday I saw somebody on the street
Who just couldn't help but cry.
Oh, this ol' river keeps on rollin', though,
No matter what gets in the way and which way the wind does blow,
And as long as it does I'll just sit here
And watch the river flow.
-- Bob Dylan, "Watching the River Flow"
As you've perhaps surmised, this is a column about Amazon.com (Nasdaq: AMZN ) , and its first-quarter 2007 earnings report due out tomorrow. After the news arrives, we'll have time a-plenty to dissect it. But in these few hours before we begin obsessing over a single bend, let's take a moment to review the whole length of the river. Our tool in this endeavor: Motley Fool CAPS, where we poll more than 27,000 investors for their views on well over 4,000 companies, Amazon.com among them. Here's what Fools have to say about the company.
Up or down?
More than 800 investors have submitted ratings on the company. The verdict: Amazon is all wet.
About six investors in 10 rate the company likely to outperform the market, a sentiment shared by both our best investors -- the CAPS All-Stars -- and the CAPS population at large. Seeing as most companies I've reviewed in this column score approval ratings upwards of 80%, it's little wonder that this less-favored firm gets just one star out of a possible five on CAPS.
Consequently, Amazon.com sits at the bottom of the pool of its CAPS peers:
|
E-commerce companies
|
CAPS rating
|
|
Blue Nile (Nasdaq: NILE )
|
****
|
|
The Knot (Nasdaq: KNOT )
|
****
|
|
Ctrip.com (Nasdaq: CTRP )
|
****
|
|
Gmarket (Nasdaq: GMKT )
|
****
|
|
eBay (Nasdaq: EBAY )
|
***
|
|
Expedia (Nasdaq: EXPE )
|
***
|
|
Amazon.com
|
*
|
Wall Street vs. Main Street
As down on Amazon.com as CAPS players are, Wall Street is more so, with analysts giving the company only seven buy ratings against nine sells. Funny, that. Because if you examine the stock's performance over the last 52 weeks, you'll see that it has, in fact, beaten the market's returns by better than 11 percentage points.
Brass tacks
And what are the thoughts behind these ratings?
Bull pitch
For the most part, Amazon bulls are fans of the company, rather than the stock. Namely, they're happy consumers who love "the low prices" and "the free shipping." Not to mention the firm's "impeccable brand recall" -- name recognition to you and me.
Bear pitch
But satisfied customers turn into rabidly anti-Amazon bears on valuation. Simply put, CAPS players think Amazon.com isn't producing enough profits to justify its share price -- revenue growth and dominant mindshare notwithstanding. As one All-Star player put it, Amazon offers "another example of companies who are great firms but poor investments."
Who said that?
To learn the identities of the Fools who penned these thoughts, and explore the plethora of additional financial data we've put together on the company, just click here.
Amazon.com and eBay are
Stock Advisor
selections. Blue Nile and Ctrip are recommendations of Hidden Gems, and Blue Nile and The Knot are Rule Breakers picks.
Fool contributor Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked 159 out of nearly 28,000 raters.
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