I downloaded Amazon's 2021 Q4 and normalized earnings with the result as as follows: I took the net income and removed the other income(expense) amounts as this mostly relates to the Rivian mark to market and to be fair I add back the 2020 Q4 other income(expense) amount. After all is done, net income for the quarter was $3,691 for 2021 Q4 vs $7,222 for 2020 Q4. Using the after hours price and taking the $7.15 EPS, the PE is still a whopping 97.
Revenue did increase (all from AWS), but expenses increased more, resulting in lower income. Further, if Rivian stays down 40% and they do another mark to market in Q1 of 2022, EPS will be destroyed!
In an environment where income is rewarded and growth is not how should Amazon be valued? In my opinion, Amazon is not a growth company and is not an income earning company either.
Say AMZN was down 8% during the day and up 14% after market for a net of 6% on the day. A 6% increase implies a strong result. I am not sure this was a strong result.
Revenue did increase (all from AWS), but expenses increased more, resulting in lower income. Further, if Rivian stays down 40% and they do another mark to market in Q1 of 2022, EPS will be destroyed!
In an environment where income is rewarded and growth is not how should Amazon be valued? In my opinion, Amazon is not a growth company and is not an income earning company either.
Say AMZN was down 8% during the day and up 14% after market for a net of 6% on the day. A 6% increase implies a strong result. I am not sure this was a strong result.