Amazon is led by Jeff Bezos, the 52-year-old founder, chairman and CEO.
Amazon earned $4.02 per share and generated $121 billion in sales during the 12 months ended June 30, 2016.
However, at 193.6 times current EPS (earnings per share), AMZN shares appear to be clearly overvalued.
Is AMZN overvalued?
Fundamentally, Amazon is overvalued with a P/E ratio of 81.12 without offering a dividend, according to Macrotrends. Amazon reported strong earnings on April 25, and the stock responded by setting its 2019 intraday high of $1,964.40 on May 3.
Why is AMZN p/e ratio so high?
Main Reason / TLDR: Amazon’s P/E is high, because the market is pricing Amazon as a tech company (with high future earnings potential from high margin products/services), on Amazon’s present lower earnings as a retail company (low margin, high revenue retail sales).
Is Amazon too expensive?
Many Amazon bears point to the company’s extraordinarily high earnings multiple as evidence that the stock is too expensive. As of the end of the day on Thursday, Amazon stock traded for 258 times the average analyst estimate of its 2017 EPS. Amazon clearly has huge revenue and earnings growth potential.
Is Amazon stock a good buy?
Amazon stock remains a good buy, as we’ll get to. However, there are two caveats: Only investors who are long-term focused should consider buying shares. Investors should build their full position by dollar-cost averaging — investing the same dollar amount at some set time interval, such as quarterly.
What is Amazon’s PE ratio?
Amazon.com PE Ratio. : 91.09 (As of Today)
Why is Amazon stock dropping?
Amazon shares fell as much as 9% in after-hours trading Thursday following its third-quarter earnings report, with the stock recovering to a 1.3% loss by Friday afternoon. The move was in part due to Amazon’s return to investing heavily in its business, which weighed on profitability.