After developing a fundamental understating of stocks (i.e., what they represent, how they are obtained, etc.), a prudent investor could focus on improving his or her ability to determine the value of stocks. Investing in stocks while they are undervalued can lead to impressive returns, but buying overvalued stocks can lead to painful losses. The process of valuing stocks can be difficult and is sometimes as much of an art as it is a mathematical exerciseespecially when attempting to predict future cash flows for young, growing companies. Determine the value of a stock and describe how you did, as well as provide a recommendation of whether or not you would recommend buying the stock.

Amazon.com, Inc.

For the nine months ended 30 September 2020,Amazon.com, Inc. revenues increased 35% to $260.51B. Netincome increased 70% to $14.11B. Revenues reflect OnlineStores segment increase of 37% to $130.9B, Third PartySeller Services segment increase of 46% to $53.11B, NorthAmerica segment increase of 37% to $160.94B, Internationalsegment increase of 31% to $66.95B.

• Could you describe the common stock that is chosen, which is Amazon?
• Could you please explain what the value of the stock is and describe how you determined its value?
• Also, could you please provide a rationale for why or why not you would recommend investing in the stock?