With the news of Jeff Bezos passing Bill Gates for richest person, I wanted to start a discussion about Amazon.
Amazon is a stock I've always struggled with. I'm an older millenial, so my finance career didn't start in earnest until the financial crisis, so while I've had chances to invest in AMZN sub $200/share, I've never been able to bring myself to buy it because I've always looked at traditional valuation metrics. leaving aside for the moment that the company purposely does not have much in the way of net income, it still trades 3x in the industry average when you look at price to cash flow (Bezos's preferred line item is cash flow). by most measures, it's an expensive stock.
as a consumer, I love the company. here's one central place where you can buy literally anything. recently my purchases have included obscure ingredients for southeast asian cuisine, workout shirts, outfits for wifey for our next vacation, and even house decor. the prices are competitive (I still remember the early days of internet shopping where you'd have to go to at least 5 websites to be sure you were getting a good deal), shipping is great, and customer service is unmatched. AMZN made a mistake for the first time in my experience with them this past christmas and they could not have handled it better.
at the same time, I worry about them getting too big and being broken up. if they don't get broken up, the company to me seems to be priced on future parabolic growth, which I have a hard time stomaching considering their already massive size and already thin margins.
help me out WSO, what am I missing?