Amazon Stock’s Exceptional Price History Meets Value Investing

The stock price history of Amazon stock is truly an amazing sight to behold. Shares of AMZN, which traded at $42 as recently as 2008, have compounded at an eye-popping 43% annualized over the past nine years to turn every $10,000 invested into $190,000. Jeff Bezos has followed Warren Buffett’s advice and filled Amazon’s pre-existing moat with alligators, piranhas, and spiked fences awaiting on the other side. Heck, they’re even securing patents for Star Wars-type processing centers that hover above the atmosphere.

And yet, if you are a student of the value investing espoused by Benjamin Graham, you can’t help but notice one fundamental fact about Amazon that makes it exceedingly difficult to value. It has no profits! There is this yawning, widening, maddening gap between the revenue and stock price history of Amazon and the lack of profit growth at the colossal online retailer.

Revenues have grown … Read the rest of this article!