As if Amazon.com, Inc. (NASDAQ:AMZN)‘s decline of nearly 25% during this year wasn’t enough, David Einhorn of Greenlight Capital has taken a short position in the stock too. Billiionaire tech investor and co-founder of PayPal, Peter Thiel explained on CNBC, how this flogging of the stock is unjustified.
“I am not going to evaluate where the price of the stock [Amazon.com, Inc. (NASDAQ:AMZN)] is right now, but I do think that Wall Street is always too biased towards short term profitability and biased against long term growth because people on the Wall Street have this, you know, daily, weekly, quarterly cycle and they can’t think ahead more than a few quarters at a time , so they are always biased that way […],” remarked Thiel.
Amazon.com, Inc. (NASDAQ:AMZN), which is one of the world’s largest online retailers, got its investors tired of waiting to see the bottom line of the company swell up, and that has led many to liquidate their holdings. Amazon is not like other companies. It is a growth story and the company has one mission, world dominance. It is not just an e-commerce company now, it has diversified into content business, tech gadgets including smart phones and what not.
Thiel explained how these characteristics play a more important role in investing rather than just the bottom line. I think David Einhorn might beg to disagree with that though. Although he might see a lot of potential for the stock in the long run, but then again if he thinks that Amazon.com, Inc. (NASDAQ:AMZN)’s lacklustre third quarter report will result in the stock taking a further dip before heading in the right direction, why not make some money of it?
“[…] On the long term I wouldn’t bet against Bezos [Amazon.com, Inc. (NASDAQ:AMZN)’s CEO], I think he is one of the great founders, one of the great entrepreneurs of our time, and I think great companies shouldn’t be profitable right away. They should have ideas. They should have ways they can invest their money in the future and Amazon has a lot of ideas how to keep investing its money […],” said Thiel.
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