INFOGRAPHIC: Why Amazon's (AMZN) Stock is So Expensive

Joel Anderson  |

There's not a lot of companies out there that could sport a P/E ratio north of 565 and still have investors clammoring to get a hold of it, but that's precisely the situation Amazon (AMZN) is currently in. In short, the online retailer doesn't actually make much money, hasn't made much money in a while, and anticipates continuing to not make a ton of money for a while longer. So why is this one of the hottest stocks out there?

In short, because online retail is the future. Americans are rapidly changing their habits, staying at home and shopping with their mouse rather than heading out to the brick-and-mortar shopping locales that have long been a key cog in American commerce. That erosion of business for store locations is part of why people will spend so much on Amazon shares even as it reinvests nearly all of its profits into expansion: it's the future of retail and everyone knows it.

And the good people at The Store have created this excellent infographic to illustrate just how dramatic the shift away from brick-and-mortar retailers has really been.

 


© TheStore.com

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not necessarily represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer.

Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     
BA

     
WMT

     
DIS

     
GOOG

     
XOM

     
BRK.A

     
FB

     
JNJ

     
WFC

     
T

     
NFLX

     
TSLA

     
V

     
UNH

     
PG