Amazon is a tough stock to own
The online retail giant is run brilliantly -- just not for the stock market.
When push comes to shove, Amazon (AMZN) doesn't care enough about stockholders -- short term, at least.
The problem is time frame. Amazon truly does believe in growth, but it has not always believed in profitable growth, and it has never cared about smooth profitable growth. So if it sees an opportunity, or recognizes that the stock and its accoutrements have to be ignored for a while, or that people expect too much right now, then it just lowers the boom on you.
That is why it is so hard to own.
It is much harder to own than, say, Netflix (NFLX), which truly does believe in profitable growth for all and even targets margins in a way that is pretty brilliant. Amazon, on the other hand, just says, "Hey, big business opportunity, swing the army in this general direction." In that sense, Amazon is much more of a military expedition that tries to overwhelm the issue than a company that tries to balance between rapid growth and growth that doesn't impact margins horrifically.
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As long as you know that, as long as you accept that Amazon's profitable growth at times strategy produces hiccups like last night's, you will be fine. Because they are just hiccups. The company is run brilliantly; it's just not run for the stock market.
The irony is that at one time Jeff Bezos was considered the ultimate stock manager -- and was blasted roundly for being that.
He sure isn't anymore, which is how you can have this dislocation in the stock today and still not want to sell it -- or, better yet, when it settles, simply buy more.
At the time of publication, Cramer had no positions in the stocks mentioned.
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