Amazing results from Amazon

Posted Jul 25th 2007 12:30PM by Eric Buscemi
Filed under: Earnings Reports, Dell (DELL), Amazon.com (AMZN)

Amazon.com (NASDAQ: AMZN), the global internet on-line retailer, reported amazing results once again. Some highlights include:

Free cash flow for the quarter was $700 million, up from $375 million last year, or up 86%
Return on invested capital (ROIC) jumped from 23% to 39%, with the on-line retailer forecasting it to jump triple digits
Revenue growth was 35%, with operating profit growth up 149%

What is also interesting, from a company that is reaching its high-growth phase perspective, is that Amazon's shares outstanding for the past year are down 2%. WOW! Typically, the opposite is true and shares outstanding goes up to reward employees with stock options.

Another interesting point is Amazon's forecast for triple digit ROIC, which is a very similar path Dell Inc (NASDAQ: DELL) followed in the late 1990s. During this period as Dell's ROIC ramped, the stock went through the roof for a good three or four years.

I'd stay with Amazon as it enters its hyper growth phase.

Tags: amazon, amazon.com, amzn, dell, earnings, growth, internet, retailer

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Reader Comments (Page 1 of 1)

7-25-2007 @ 5:48PM

Michael Schneider said...

Amazon results were aided by Harry Potter fans, cost-cutting and a few other factors including sales of electronics. Amazon stock moved up around 25% at one time today and CNBC reported that it was the company's biggest one day move since its IPO.

Synopses of recent articles on Amazon and on Expedia are just newly posted in the Internet Stock Update section (green label, left side) at http://www.Barrelomoney.com.