Don’t Follow the Crowd: AMZN Is Still Investment Worthy
The supply chain nightmare is catching up to e-commerce heavyweight Amazon.com (AMZN).
This time last year, analysts’ consensus estimates put AMZN’s earnings per share (EPS) at $15.79. In anticipation of this Thursday’s earnings report, that estimate fell 40%. That’s a huge year-over-year crunch – one that made some investors sell one of the best long-term investments out there.
As I mentioned in Monday’s Watchlist, sometimes the best way to profit is by going against the grain. Now, I’m saying it again. Don’t follow the crowd.
Watch today’s Take It to the Bank Tuesday below or scroll down to read the transcript.
04/26/2022 Take It to the Bank Tuesday Transcript
Hey everybody! Shah Gilani coming to you from Fox Studios in Sarasota, Florida, where I got the background ready to go on Making Money with Charles Payne here on Monday afternoon.
But before I go on air… It’s time for your Take it to the Bank Tuesday, where I recommend what you should do with $100 today. I’ve got a really interesting one here for you this week.
Earnings, earnings, earnings – and who was the biggest player in the earnings business? As far as I’m concerned, this week it’s Amazon.com (AMZN). Its earnings will come out after the bell on April 28.
Now, the expectations are pretty rough. That’s because, a year ago, the equivalent quarter had a huge EPS gain to $15.79. On the 28th, earnings are coming out after the bell for $9.22 EPS. That’s a huge year-over-year crunch – and I don’t think the stock is going to react well.
If earnings come in below that, the stock is gonna get hit hard. If forward guidance is anything but robust, which it’s not going to be… I mean, good luck with that. Amazon isn’t famous for giving much forward guidance. So, that is going to be taken as a negative if they don’t have anything positive to say. And if Amazon doesn’t say anything, guess what the reaction will be.
Of course, most of the issues that Amazon is having are supply chain issues. So, the big drop year-over-year, I think, will hit the stock. Again, expectations for AMZN are $9.22 – that’s analysts’ consensus estimates. If we get anywhere below that, the stock is gonna get hit – and that’s an opportunity.
You want to buy your $100 worth of AMZN on any kind of dip – but wait until morning. If you can, buy the dip in the afternoon as earnings come out, but there is always the chance AMZN will be even cheaper Friday morning.