This argument ignores the short term reality of 3% market share and declining margins because it assert, simply asserts, that Amazon will change the marketplace in the long run. Maybe it will, but when we rely on the long run, we also expose ourselves to a greater window for technological change. Amazon is built on the model of the web that has been around for almost 20 years. It seems to me that new web technologies could easily disrupt this model. Phone and Tablet apps can create a paradigm that makes web browsers obsolete. Imagine each supplier creating an app like they now create a website and imagine all those apps being able to be self organizing into virtual storefronts. In effect, you would create your own virtual "Amazon" just by looking. I haven't really thought this through, but the point is that the P/E for Amazon is built on projecting pretty optimistic assumptions while ignoring the almost inevitable change that will occur as the web shift from PC to mobile devices. I would get out now

Jul 29 2012 at 12:28 AM EST

What if other big retailers like walmart and costco adopt the same practices and compete with amazon. I think amazon is a very risky stock since there is no room even for a small misstep....it will blowup in your face.

Jul 29 2012 at 4:32 PM EST

If you focus on the types of items that can be delivered to a consumer, the share that is delivered is now 21.3% and will likely hit 33% by the end of the decade.
http://cepobserver.com/2012/07/growing-usps-ups-and-fedex-volume-is-not-just-from-e-commerce/

As much of the growth in retail sales now is in lower-value, lighter weight categories (clothing) that means shipment growth may be faster than than $ growth in sales That is why
Amazon's biggest problem is handling the volume growth. That is why it is increasing benefits for workers in warehouses to include education funding just like UPS does and making major investments in parcel lockers. See:
http://cepobserver.com/2012/07/amazon-goes-head-to-head-with-usps-with-parcel-lockers-in-virginia/

Jul 26 2012 at 11:27 PM EST