Amazon.com, Inc. (AMZN)’s New Frontier

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Foolish bottom line

Amazon.com, Inc. (NASDAQ:AMZN) has been a true trailblazer when it comes to e-commerce. However, its rich valuation is going to keep me out of this stock, as its core business is seeing more competition from Wal-Mart Stores, Inc. (NYSE:WMT) and eBay Inc (NASDAQ:EBAY)’s buy-it-now feature. Amazon’s most recent venture against companies like International Business Machines Corp. (NYSE:IBM) could potentially be a new source of revenue from enterprises.

International Business Machines Corp. (NYSE:IBM) has a proven revenue stream and a plan to increase its earnings. Amazon has continually sacrificed earnings for revenue growth. Unless a tech company can show that it can maintain profitability over the long term and have increasing or stable margins, I wouldn’t invest in it anytime soon.

Everyone knows Amazon is the king of the retail world right now, but at its sky-high valuation, most investors are worried it’s the company’s share price that will get knocked down instead of competitors’. The Motley Fool’s premium report will tell you what’s driving the company’s growth, and fill you in on reasons to buy and reasons to sell Amazon. The report also has you covered with a full year of free analyst updates to keep you informed as the company’s story changes, so click here now to read more.

Wes Patoka owns shares of International Business Machines. The Motley Fool recommends Amazon.com and eBay. The Motley Fool owns shares of Amazon.com, eBay, and International Business Machines.

The article Amazon’s New Frontier originally appeared on Fool.com.

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