So, Amazon is up another $8 today on the news that they are buying Twitch for about a billion dollars. If you don’t know what Twitch is you are not alone. It is a website where you can go to watch gamers play a variety of games through a live stream.
It may not be a bad purchase in the end but it shows how Amazon is all over the board throwing money at things whiteout a clear iron clad strategy in mind. At least I don’t see one. Take the news about the Fire Phone….it can already be called a massive failure by the reports coming out today.
Right now, Twitch is making money (though not a lot) and that is more than can be said about Amazon.com. While the quarterly earning continue to stagnate, Amazon stock continues to be surprisingly resilient. As long as they are expanding and throwing money at dreams, investors seem to still be willing to give them a pass. Which is incredible in my opinion.
Everyone knows that the market is at an all time high and the trepidation can be felt day to day. We all know that sooner or later, a correction of some sort will come. We just don’t know when or how much.
I’ve got to think that when that much needed correction does come AMZN stock is going to crater. With a P/E over 500 and it may dive even before we get a correction if investors tire of big revenues with little profit. It does seem that each earnings report is met by more and more selling and one of these quarters will be a tsunami.
At some point I may have to short this stock. Just when to do it is extremely hard to figure out.