Amazon.com, Inc. (NASDAQ:AMZN)’s CEO, Jeff Bezos, admission that the company’s Fire Phone previously dubbed as a ‘shopping machine’ might have failed cements analysts suggestions that the company has been a flop all year long. CNBC’s Steve Grasso attributes the poor show by Amazon this year to a shift in focus to investing in other fields other than focusing on growing value on core business.
Investors continue to air their concerns about Amazon.com, Inc. (NASDAQ:AMZN)’s wave of spending that has only gone to affect profit margins without any substantial returns. Bezos on his part maintains that Amazon is at the moment a startup facing high levels of volatility that startups always face.
“They have done a lot of these investments on their structures on their warehouses. They could easily pull that back if they wanted to, but it sounds like he still wants to be considered a growth name. So he is not going to invest in that, I want to be a value stock,“ said Mr. Grasso.
Grasso argues investors planning to invest in Amazon.com, Inc. (NASDAQ:AMZN) should pick it as a long term investment as in the short term the company’s prospects continue to look bleak at the back of the ongoing aggressive spending. Bezos has vehemently defended Amazon’s culture arguing it is one that is willing to spend on new projects even if they amount to mounting more pressure on the company’s margins
Brain Kelly reiterates that Amazon.com, Inc. (NASDAQ:AMZN) remains a sell having underperformed for the better part of the year.
“I think it is broken, I think Amazon is a broken stock this year the whole year it’s been broken. […] You had to believe that Amazon was going to do better. This Year Wall Street stopped believing in that and every single quarter you’ve seen it go lower and lower and until Bezos or Amazon prove that they have another blockbuster on their hands. I think this stock is dead money,“ said Mr. Kelly.
Being Neutral at best according to Timothy Seymour remains the only viable position on Amazon.com, Inc. (NASDAQ:AMZN) until the aggressive spending stops and focus shifts towards growing shareholders value.
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