amazon
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Buy, Sell or Hold: The Smart Money is Selling Amazon.com
I love the super deals that I get from Amazon.com (NASDAQ: AMZN). They always seem to beat the brick-and-mortar stores and I get two day-delivery for free.
It's no wonder to me that the online retail giant has ranked at the top of Foresee's E-Retailer Consumer Satisfaction index for eight straight years.
What I do have doubts about is Amazon's share price. It continues to make new highs while the company's core business is slowing and its new "growth" businesses aren't all they are cracked up to be.
With a P/E that has now reached astronomical levels, here's why the only money I'll be giving to Amazon will be what I spend on its merchandise.
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Why the CIA and Amazon Are All Over This Quantum Computing Upstart
The CIA and the world's biggest Web retailer want to see the world of Big Computing turned upside down.
That's why they joined a $30 million investment round in a small supercomputing startup. The firm is taking a radical new approach to how these processors crunch massive amounts of data.
It's a field that is quickly turning its skeptics into true believers. Then again, cutting-edge tech like quantum computing doesn't come along every day.
No doubt, quantum computing is some pretty complex stuff. So, let me simplify it for you. At its root, quantum computing relies on the high-speed action inside atoms as well as particles of light.
The result is speeds so fast it makes your head spin.
We're talking about computers that could perform some functions millions of times faster than anything that's on the market today.
It's no wonder the nation's top spies and Amazon.com (Nasdaq: AMZN) founder Jeff Bezos want to get in on the ground floor. Though they didn't say how much each ponied up, both took part in the most recent round of financing for D Wave Systems.
In-Q-Tel, which invests in high tech that supports the CIA, and Bezos Expeditions join a growing list of D Wave investors. Other blue-chip backers include the Business Development Bank of Canada, Draper Fisher Jurvetson, and Goldman Sachs (NYSE:GS).
D Wave: Quantum Computing's Kingpin
Founded in 1999, D Wave spent its first five years in discovery mode. By that I mean the small firm was focused on coming up with novel ways to make quantum computing work and then get the patents it needed to protect the moat it was building.
That early attention to detail has clearly paid off. Today, D Wave holds 90 U.S. patents and has roughly 100 more pending around the globe.
Here's the thing. D Wave is founding a whole new sector of the computing industry while making sure it maintains a strong first-mover advantage.
After struggling for years, D Wave is now on a roll.
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Why AMZN Stock is Soaring
Amazon.com Inc. (Nasdaq: AMZN) stock is up more than 15% in midday trading, after an earnings report that predicted slowing growth and profits in Q3. So why are investors interested in a stock that will make less money - and may even post a loss?
Money Morning's Chief Investment Strategist Keith Fitz-Gerald joined Fox Business' "Varney & Co." Friday to talk about the value in Amazon.com. Keith explained how Amazon.com's Q3 outlook isn't a bad thing.
Keith also shared a stock that he sees outperforming in this economy, and talked about how the GDP numbers highlight the "mess" Washington has created for the U.S. economy.
Watch this accompanying video for Keith's full analysis.
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Amazon.com Inc (Nasdaq: AMZN): Investors Flee on Weak Q3 Outlook
Amazon.com Inc. (Nasdaq: AMZN) today (Thursday) reported a fiscal second-quarter profit of $7 million, or a penny a share, on revenue of $12.83 billion - very close to what was expected, but still a miss.
Analysts forecast a sharp increase in revenue, estimating earnings per share of two cents on revenue of $12.92 billion. Sales were up 29%., but net income fell 96% from the same period a year ago.
Weighing on its bottom line was investments in new distribution facilities, a number closely watched because Amazon has a history of reporting strong revenue. The company has been plowing copious amounts of its earnings into building a distribution network to help it more efficiently grow its business long term.
After reporting better-than-expected first-quarter numbers, 41 cents on revenue of $9.91 billion, the Seattle, WA.-based company had expected revenue to fall in the range of $11.9 billion and $13.3 billion.
Pushing the stock down as much as 7% in after-hours trading was the Q3 guidance.
Amazon.com predicted a Q3 operating loss of between $50 million and $350 million, versus Wall Street estimates of income of $119.6 million. Amazon said it expects Q3 revenue of $12.9 to $14.3 billion, which includes the Wall Street estimate of $14.1 billion.
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Does the "Showroom Effect" Spell Trouble for Amazon (Nasdaq: AMZN)?
Thanks to the "Showroom Effect," Target Corp. (NYSE: TGT) and Amazon.com Inc. (Nasdaq: AMZN) have parted ways.
That means Amazon's hot new Kindle e-reader will no longer be found on the shelves of one of the biggest U.S. chain retailers.
The "Showroom Effect" is a phenomenon in which consumers use brick-and-mortar stores to test drive certain products before purchasing them online at a lower price.
This isn't the first shot fired in the war between the world's largest online retailer and the second largest discount retailer in the United States.
The Beef with Amazon
Retailers have long complained of Amazon's unfair competitive advantage because the online retailer is exempt from charging state and local sales taxes.
Last spring, Target, along with Wal-Mart Stores Inc. (NYSE: WMT), Best Buy Co. Inc. (NYSE: BBY), The Home Depot Inc. (NYSE: HD), and other retailers threw their collective weight behind the Alliance for Main Street Fairness, a coalition that is leading efforts to change sales-tax laws in more than a dozen states, including Texas and California.
But the sales tax gap is just part of the problem.
During last year's holiday shopping season, Amazon offered 5% discounts up to $5 to "show-rooming" consumers who used the online giant's Price Check mobile app in a physical store-in essence, encouraging the Showroom Effect.
In response, Target sent a letter to its suppliers urging them to help combat the Showroom Effect, either by delivering more in-store exclusive products, or by helping to them to match the prices of Target's online rivals, including Amazon, TigerDirect, Overstock.com Inc. (NasdaqGM: OSTK), and eBay Inc. (NasdaqGS: EBAY).
Even still, retailers like Target have other issues with online competitors like Amazon - such as what happens after the sale.
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