Amazon.com, Inc. (AMZN) Stock: Why It’s Headed Down


Amazon.com, Inc. (AMZN) is making a move down in the market in today’s trading session. The stock, focused on the service industry, is currently priced at $1764.77 after falling -3.00% so far today. As it relates to service stocks, there are quite a few factors that have the potential to lead to movement in the market. One of the most common is news. Here are the recent stories relating to AMZN:

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Nonetheless, when making an investing decision, prospective investors should focus on much more than news, especially in the ever incredibly complex service sector. Here’s what’s happening in regard to Amazon.com, Inc..

The Performance That We’ve Seen From AMZN

Although a decline in a single session, like the fall that we’re seeing from Amazon.com, Inc. might cause fear in some investors, a single session fall alone should not be the reason for a decision to, or not to, buy a company’s stock. It is generally important to look at trends experienced by the stock further out than a single trading day. When it comes to AMZN, here are the returns that investors have seen:

  • Past Seven Days – Over the last seven days, AMZN has generated a change in value that amounts to 3.06%.
  • Monthly – The return on investment from Amazon.com, Inc. over the past month works out to 8.97%.
  • Past 3 Months – Over the last quarter, the company has generated a ROI of 18.04%
  • Past 6 Months – Throughout the past six months, we’ve seen a change that amounts to -8.39% from the stock.
  • YTD – Since the the first trading session of this year AMZN has resulted in a return on investment of 17.50%.
  • Annually – Lastly, throughout the past full year, we’ve seen performance in the amount of 11.56% out of AMZN. Over this period of time, the stock has traded at a high of -13.93% and a low of 35.02%.

Rations That Investors Should Think About

Looking at a few key ratios having to do with a company can give investors a look of how dangerous and/or rewarding a stock pick may be. Below are a few of the key ratios to think about when digging into AMZN.

Short Ratio – The short ratio is a measure of short interest. As the ratio heads up, it shows that more investors have a belief that the value of the stock is going to tumble. In general, strong service sector stocks tend to come with a lower short ratio. On the other hand, we also tend to see a lot of short squeezes in the space. Nonetheless, in relation to Amazon.com, Inc., the stock’s short ratio is 0.77.

Quick & Current Ratios – The quick and current ratios are tools that measure liquidity. Basically, they measure whether or not a company can pay for its debts when they come due based on quick assets or current assets. do have positive quick and current ratios. In terms of AMZN, the quick and current ratios come to 0.80 and 1.10 respectively.  

Book To Share Value – The book to share value compares the the share price to the book value of assets that are owned by the company. as it relates to Amazon.com, Inc., that ratio comes in at 88.88.

Cash To Share Value – Finally, the cash to share value ratio compares the total cash on hand to the value of shares. In this case, the cash to share value comes to 81.46.

What Are Big Money Players Doing With Amazon.com, Inc.

Humans that are into investing seem to be infatuated with the term “Smart money follows big money.” It makes sense. Big money became big money by making smart decisions in the market. So, by following the moves of big money institutions and insiders, we can get a glimpse of what market pros think about a stock. When it comes to big money interest in AMZN, here’s what we’re seeing:

Institutions own 57.00% of the company. Institutional interest has moved by -0.14% over the past three months. When it comes to insiders, those who are close to the company currently own 16.10% percent of AMZN shares. Institutions have seen ownership changes of an accumulative -0.06% over the last three months.

How Analysts Feel About Amazon.com, Inc.

While it’s rarely a smart idea to unknowingly follow the opinions of analysts, it is a smart idea to use their thoughts when validating your own due diligence before making an investment decision in the service industry. Here are the most recent moves that we have seen from analysts when it comes to AMZN.

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Mar-20-19 Initiated Evercore ISI Outperform $1965
Mar-15-19 Upgrade KeyBanc Capital Markets Sector Weight → Overweight $2100
Feb-01-19 Reiterated BMO Capital Markets Outperform $2300 → $2250
Jan-30-19 Reiterated The Benchmark Company Buy $2100 → $2000
Jan-09-19 Reiterated BofA/Merrill Buy $2000 → $2100

Financial Performance

What have ween seen from AMZN in terms of financial results?Here’s the data:

  • Analyst Expectations – As it stands, analysts are expecting that Amazon.com, Inc. will report EPS of 39.96, with 4.73 to be reported in the report for the current quarter. Although this data is not based on earnings, since we are talking on the topic of Wall St. analysts, AMZN is presently rated a 1.70 when rated on a scale from 1 to 5 where 1 is the worst possible Wall St. analyst rating and 5 is the best rating.
  • 5-Year Sales – In the past half decade, Amazon.com, Inc. has created a movement in sales volume that comes to a total of 25.60%. Earnings per share through the last 5 years have experienced movement in the amount of 102.00%.
  • Q/Q – when it comes to quarter over quarter data, or Q/Q data as it is generally explained in the world of humans, Amazon.com, Inc. has created a change in earnings that amounts to 166.60%. The company has also experienced a change in terms of sales volume that adds up to 19.70%.

Interested In How Many Shares Are Available?

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 506.37M shares of Amazon.com, Inc. outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, AMZN has a float of 411.82M.

It’s also important to dig into the short percentage of the float. After all, if a high percentage of the float is shorted, the overall feeling among investors is that the stock is headed for a deep dive. With regard to AMZN, the percentage of the float that is sold short is 1.03%. Most traders believe that a high short percent of the float would be any percentage over 40%. In my research, I have calculated that any short percent of the float over 26% is probably going to be a a play that could prove to be very risky.

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