The Market Ticker
Commentary on The Capital Markets- Category [Earnings]

Amusing price action, really.

Amazon had earnings and their shares popped materially, now trading back to where they were around the beginning of December.  Between the day's change and after-hours the stock is up roughly 13%.

Here's the problem -- revenue was light due (largely) to FX.  There are plenty of people ignoring the FX, which is probably where the pop is coming from.  However -- net sales were really only up in North America.

The other problem is that free cash flow decreased against year-ago figures, and so did net income.

Further, first-quarter guidance is pretty awful.

How someone manages to sell you a stock for nearly $350/share when the company only manages to come up with $591 million in operating income on $29.3 billion in gross sales simply astounds.  I mean, really, a 2% operating margin merits a P/E of somewhere around 700 (assuming they manage break-even the other three quarters to come -- which is probably optimistic!)

No, that's not a bubble.

As for Google, watch the birdie.  You can't short a stock that refuses to decline into a no-bull**** revenue and earnings miss, but if there's a company out there that does advertising, including mobile, better than anyone else it's Google.

The bird is chirping in your ear folks; flush the damn wax out and pay attention lest you start crying about being "surprised" in another few months....

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