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Easiest vote I ever cast. Option 2 where you get ownership in 4 good companies.
Putting all of your eggs in one basket is too risky. In a worst case scenario, Amazon could be broken up by the government, like AT&T was back in the day.
These are all megacap stocks... there are places to invest money that will provide much better returns. For AMZN to justify it's current stock price in a few years when it's revenue growth starts to slow, it will have to make something like $20/share per quarter.. right now they make under $4.
I'd be careful about following the herd into AMZN. WMT is a better choice because they are going to make big gains in the online space which will help their revenues.. they also have a very efficient supply chain.
I would pick option 2... though in reality it's neither for me. I look for small companies that have the potential to grow into big ones... to do this you have to invest in companies that seem to be "not a good value" meaning they don't have PE ratios of 20.. in fact most of them are unprofitable at the time I invest in them. The idea is they grow their revenues and when they get bigger, find ways to cut costs so they start to earn money. (which is exactly what AMZN did and is doing)
At best AMZN could double.. it's not going to be a 10 bagger because it's already a massive market cap. It's going to transition from a growth stock into a blue chip stock over the next 5 years, in my opinion. They will also start getting more hate because they are 'big' just like Walmart used to get and still does. They are going to come up with ways to try to make more money to boost their EPS, which will allow competition to come in and take away some of their market share. They ran for a long time losing money so they could grow and attract people with their low prices... that will gradually change and is changing...
I'm not going to give a specific recommendation here... the average person should invest in a broad based index fund and not speculate on individual stocks unless they have enough stock market experience to know how to read a balance sheet and earnings statement.
These are all megacap stocks... there are places to invest money that will provide much better returns. For AMZN to justify it's current stock price in a few years when it's revenue growth starts to slow, it will have to make something like $20/share per quarter.. right now they make under $4.
I'd be careful about following the herd into AMZN. WMT is a better choice because they are going to make big gains in the online space which will help their revenues.. they also have a very efficient supply chain.
I would pick option 2... though in reality it's neither for me. I look for small companies that have the potential to grow into big ones... to do this you have to invest in companies that seem to be "not a good value" meaning they don't have PE ratios of 20.. in fact most of them are unprofitable at the time I invest in them. The idea is they grow their revenues and when they get bigger, find ways to cut costs so they start to earn money.
At best AMZN could double.. it's not going to be a 10 bagger because it's already a massive market cap. It's going to transition from a growth stock into a blue chip stock over the next 5 years, in my opinion. They will also start getting more hate because they are 'big' just like Walmart used to get and still does. They are going to come up with ways to try to make more money to boost their EPS, which will allow competition to come in and take away some of their market share. They ran for a long time losing money so they could grow and attract people with their low prices... that will gradually change...
Walmart has greatly underperformed the s&p over 1, 3 , 5, 10 and 15 year periods per Morningstar and is down nearly 20% in the last 3 months. Maybe that puts them in a spot to outperform but if you have been holding for years you’d need one hell of a run to pull even with the vanilla s&p. Walmart faces the same eps growth problem that amazon does even if the don’t trade anywhere near the multiple because it is kind of a big company too
Walmart has greatly underperformed the s&p over 1, 3 , 5, 10 and 15 year periods per Morningstar and is down nearly 20% in the last 3 months. Maybe that puts them in a spot to outperform but if you have been holding for years you’d need one hell of a run to pull even with the vanilla s&p. Walmart faces the same eps growth problem that amazon does even if the don’t trade anywhere near the multiple because it is kind of a big company too
Given the two options choice 2 is probably better.. MSFT is growing again after a decade of relying in windows and office for their revenues and lagging behind in innovation. WMT has a market cap that is 1/3 of Amazon, and Apple is swimming in cash and so is Google. Unless someone comes around to give youtube competition, you have google, apple, and microsoft basically having a 99% market share in the operating system market with android and IOS being mature platforms along with windows for the desktop. The unknown variable is with all the cash Google and Apple have, who might they acquire? How much can they expand into emerging markets? WMT did buy flipcart to try to expand into India.. a good move or not? Time will tell. I personally think they overpaid but they have the right idea by trying to capture online market share and expand/grow.
WMT did underperform, but they are showing signs as a company that they want to try to adapt to the increase in online sales.. if they make some acquisitions and position themselves correctly and can get people buying from their websites instead of amazon, they can take considerable market share from Amazon and break that streak of lackluster performance. People underestimate how great their supply chain is and how that could work in their favor to get things people want to them quickly and cheap.
Cool story when people talk about 10 baggers it’s kind of easy just to skip past it as it’s pretty uncommon or accompanied by larger losses. A good old internet love story
I'd be careful about following the herd into AMZN. WMT is a better choice because they are going to make big gains in the online space which will help their revenues.. they also have a very efficient supply chain.
I really stopped reading right there...WMT had a great & efficient supply chain, and really only continues to deliver on pricing efficiencies due to their size.
I also think AMZN will continue to grow, is it going to double in the next 5 years? Probably not, but I also didn't think i would be 4.5x more than it was in 2015, just 3 years ago. As AMZN continues to develop more presence, distribution, and even more market share they will continue to outperform WMT, and others IMO. I'll stick with my AMZN.
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