The following is an excerpt from Michael Regan | January 29, 2016 | bloomberg.com |
The moonshot in Amazon.com's shares last year catapulted it into the top 10 biggest companies in the U.S. by market value.
And, from a trading perspective, that's sort of peculiar because the stock has some characteristics that make it look a lot more like a penny stock than a stable stalwart of the blue-chip pile.
For starters, how much money Amazon.com is expected to make in any given quarter is anyone's guess. Its earnings guidance for the fourth quarter was a mile wide -- from $80 million to $1.28 billion. In the previous quarter, it was a loss of $480 million to a profit of $70 million.
As a result, Amazon's reported results are often way off the mark compared with Wall Street expectations. Fourth-quarter net income came in Thursday at $482 million. While that was a record, it was well below the average analyst estimate for $742.9 million, and its shares took a beating.
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