- Calculate the (compound) growth rate of dividends over the past 10 years
- Calculate the growth rate using the plowback ratio (b) and ROE using the most recent dividend and ROE
- Use the above estimations of the growth rate, the most recent dividend, and the cost of equity of the firm to calculate the intrinsic value.
- Compare the intrinsic value with the current market price of the firm along with your evaluation of the industry and overall economy and provide a recommendation to buy, sell, or hold.
AMAZON: COMM "DO-111111211 111.151.0155 3 M10313 SAFE\" 35333050501 Tea-N100. 5 M3313 135113 1.15 (1.00:1.011211 REC PRICE 160.6 71 437. 82 innoNMFGi-ii) 135.6 246.7 264.1 REA'i'E PIE 1111110 NMF 113\" VALUE LINE Target Price Range MIMJJASON 0080)! 000000000 0m0070070011 00%| 107005007 2020-22 PROJECTIONS AI'II'I'I TOM Prim Gar Return High 1320 40% 93 Law 330 40% 42% Insider Decisions Institutional Decisions lmmm 311101:me ins iiunur 3m 1m 0 11.071311 311311221 310:3; llmmlllllllHiMF-g______1yr.50.0 15.3 a: 54.0 74.5 773 Illl'II'IIII Hummi_ Syr. 276.3 30.1 11030011321213 313413 303732 ||||||||liilll!11 I111111111111IIIIIIHIIHIHI'ITIIIIIHI'I'I'H'M'M 51r- 365-2 92-5 2001 2002 2003 2004 2005 2006 2007 2000 2009 2010 VUElNEPiJBllC 8.37 10.14 13.05 17.16 20.41 25.87 35.66 44.78 55.20 75.84 humanism 0.21 .21 .60 1.05 1.10 .95 1.74 2.07 2.88 3.81 \"08311 Flufparsll 0.44 0.01 .40 .82 .79 .45 1.12 1.319 2.04 2.53 . . EIIi'IigB [at all 5 .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ' u'dsmd'dws .13 .10 .11 .22 .49 .52 .54 .78 .84 2.17 3.98 8.33 7.50 10.54 9.74 14.12 13.00 14.50 Cip'lSpnd'llgpaIsll 10.45 1:13.86 113.49 1:12.57 01.56 .59 1.04 2.88 6.24 11.84 15.22 17.05 18.02 21.22 23.13 28.42 40.43 57.73 00.05 Book'Jleplell 140.05 373$ 387.91 403.35 403.35 4161]] 414.0] 416.80 428.80 444.120 451.0] 455.07 454.55 459.26 464.38 471.80 477.00 480.00 403.00 mmmmisom'g' 487.00 - - -- NMF NMF NMF NMF NMF NMF 42.8 NMF NMF MrlF NMF - - NMF NMF NMF Mg lli'l PIE Relin 35.0 NMF NMF NMF NMF NMF NMF 2.85 NMF NMF MilF NMF NMF NMF NMF RaleiUePfERa'lin 2.20 CAPITALSTRUGTUHEaaoHMlHT 14836 19166 24509 34204 48077 61093 74452 88988 107006135987177866 0000 bmumll 301470 6.1% 5.8% 6.6% 5.8% 4.0% 4.6% 5.4% 5.5% 8.0% 9.0% 0.9% 0.7% My High 8.0% m"um$24743-m"'-\"\"e'\"5""$3572- 245.0 231.0 353.0 503.0 1033.0 2153.0 3253.0 4145.0 3231.0 31150 11113 12000 museum-11311:] 11000 I 476.0 603.0 902.0 1152.0 631.0 130.0 274.0 0241.0 596.0 2371.0 2244.0 4385 lhtPl'nitllmi] 15445 LTneM$24jr430mi|L L1|m$g1o_om||l_ 27.9% 26.1% 21.8% 23.5% 31.2% NMF 31.8% -- 60.6% 36.6% 35.0% 25.0% hmeTaxRete 22.0% [470301132150 3.2% 3.1% 3.7% 3.4% 1.3% .2% .4% NMF .6% 1.7% 1.3% 2.0% lb'll'l'aillllug'i 4.3% 1450.0 1411.0 2433.0 3375.0 2594.0 2294.0 1645.0 3218.0 2575.0 1965.0 2314.0 18445 Wakiing'lmi] 01720 Lam"\"\""|'\"'\"m=$'3'7'm"'- 1232.0 331.0 103.0 1130.0 353.0 3031.0 3131.0 3235.0 3235.0 1334.0 211133 25500 Lang-Tam 0311113111.] 27500 33031111311031.3111 Pension,\" 1131.0 2512.0 5251.0 3331.0 1751.0 3132.0 31-130 10141 13331 13235 27103 31310 31135111111713.1131 12335 20.8% 18.9% 17.1% 16.0% 7.7% 1.6% 2.7% NMF 3.8% 9.7% 0.5% 11.0% anliTo'lde'l 19.095 Gmmondei480,000,0005hs. 39.8% 2.5% 17.2% 16.8% 8.1% 1.6% 2.8% NMF 4.5% 12.3% 0.5% 13.5% lIe'IilniiliSlitEiipii'l}!I 21.0% 39.8% 22.5% 17.2% 16.8% 8.1% 1.6% 2.8% NMF 4.5% 12.3% 0.5% 13.5% Reh'ladtoCmIEq 21.0% HARKETGAP:$69IbiIIion{LergeGq:} __ __ __ __ __ __ __ __ __ __ __ N11 AlDiv'dehlle'tProl N11 CU?;1.ELlli-'{P5IWN 2015 201612731\"? BUSINESS: 0111320000111 lsoneafthe largest onlhe retailers.'ihe Audiblemm, '08,2qip0s, 09.141103 Foods Market, '17.Hasdiout Cash Assets 19303 25931 30906 company opened its virtual doorsin 1995_Sales breakdown [2016}: 230,300 employees. Oinersldirectors own 17.0% 01 outsiandhg [lam-glee (Avg ca} La\"; Lg; 131133: media (books, music, and videos; 15% 01 sales),elect.rorics (30%); common stock (hcluding Mr. 332051333) (4111 proxy). Presi- Current Assets 36474 45731 m other (25%}. International sales, 32% of total. Third-party sellers dent, Chairman 31 01131 Executive Ofcer: Jeffrey Bezns. In- Aocts Payable 20397 25309 34616 (01311150313712) mum for abuut 20% 01 sets. Seasmalty; (.14 ac:- mrporated; Delaware. Addr; 410 Terry Avenue North, Seattle, WA Deb'tDue __ __ __ (lmed for 32% 01 '16 revenue. Acquired CDNOW, '02, 93103-5210.Tel.:206-266-1000.Imemeimmemazmmm. Other 13502 13507 23257 Since our November review, shares of 7%, to $4.55 a share. CurrentLIah. 33399 43316 57333 Amazonxom continued to rise. Indeed. We have tempered our share-net out- ANNUALRATES P331 P381 50'4\"?\" over that interim. the equity's price has look for this year. Amazon appears 33:23:55\") 127% 24.5% 12.12%: advanced about 30%. This comes after the poised to register a revenue advance of ap- "Cash Flow" :31qu, 34:53, 21:59:, company continued to successfully imple- proximately 25%. to $220 billion in 2018. Eamlngs 10.5% 4.0% 60.0% ment signicant growth strategies. This ought to reflect organic growth at the glu'gfggsue 5:50:16: 150:}; 3001:: Meanwhile, the company posted North American and International seg- ' ' ' mixed financial results for 2017. On ment. Having Whole Foods contribute to Cal- Full the upside,revenues increased 31%, to al- the top and bottom lines for the entire ends Y9" most $178 billion. due to solid. double-digit year will also be a plus. What's more. the 2014 2933 3393-5 gains across all of Amazon 's divisions. The AWS segment continues to expand global- 2015 35747 070% North American and International seg- Iy. That unit was recently selected by 12.31; 80433 gag ments experienced growth .of 33% and entities like Symantec.the N'FL.and Walt 2018 11111 23%. respectively. Those units make up Disney Co. for cloud services. On the the lion's share of overall operations. Else- downside. the buildout for these rapid Gal- HMNGSPERSHABE' FI-Ill where. the Amazon Web Services unit growth initiatives is weighing on margins. ends \"\"31 Junj 5011.30 \"\"31 1" logged volume gains of about 43%, which Consequently, we have sliced $2 .45 off our 2014 23 C127 1195 ~45 052 was nicely additive to overall operations. annual earnings estimate. to $9 .00 a 2015 \"-12 ~19 '17 1.00 125 Finally. the recent acquisition of Whole share. This would still represent a 100% :3}; 1'07 1'13 g: 275 :55 Foods Market has been a contributing fac- gain over 2017's somewhat easy com- m.\" 2'2: 1'53 \"5 3:22 900 tor. 0n the profitability front. margins parison. Other interesting developments ' ' ' ' were squeezed by rising operating ex- included a push into brick 82. mortar stores 133" MMEHVHVDBDSMD F9" penses due to spending on the buildout of with the cashierless grocery store in ends \"\"31 3011.30 Sep Dec-3' Year the fulllment network. and technology. Seattle; and the acquisition of Sqrrl. a 2014 content and marketing efforts. On balance. cyber security start-up. 2015 NOWHDMDENDS after excluding $789 million ($1.60 a At this juncture, Amazon shares ap- 201G BEINGPAID share) of nonrecurring provisional tax ben- pear richly valued. :1; efits from the U.S. Tax Act, earnings fell Bryan J. Fang February 9, 2018 (A) Diluted earnings. Excludes gonduiill: '02, (13}. hcludes stout-timed mpensalinn; '02, (19311; '03. [214}; '04. (14); '05, (2041; '06. (2441; '07. [44]; '03. (5410; '09. (7710- EX- 3311! \\hlua lire, hi: ll 11-EPLBJEi-EFHSMJT 53; eludes mergertaoqtisitim 00515: '02, {110}; '03, sum due to rounding. Next earnhgs report due (3211.). Excludes equity in losses; '02. (0113}. Ex- late Ap eludes oliier nonrecurring items: '04, 543; '05 '12, (3713}. 00y. revenues and 395. may not mammalmdalismdmdhmsmmbmmbemiaemdis B_E FCFI ANYEFFDFE CFI 011165035 l-EFEN. 1113 or mherqrndned. rend madamedhaypedeieamicadhe-hm or ril. , (a) in millions. prodded 11111-1001 wara'li'es d 'mmisaidybremeibersm mm'rem'aijrtm'd Lee. hgereigcrmrehgeypedaeemuicpcmmsedcecrpmn Germany's FimmlalSh-engih A+ stock's Price 51311111111 50 Prim (i'uwth Persistence 100 EUnl 0: Predlemili 10 5:11 To subscribe call 11300-VALLEIJ0E
