Amazon.com Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Amazon.com (NASDAQ:AMZN) will unveil its latest earnings tomorrow, Tuesday, January 29, 2013. Amazon.com sells millions of products across dozens of product categories on its web site. It also manufactures and sells the Kindle, an e-reader.

Amazon.com Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 29 cents per share, a decline of 23.7% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 50 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 30 cents during the last month. Analysts are projecting net loss of 3 cents per share versus net income of $1.34 last year.

Past Earnings Performance: The company is looking to top analyst estimates this quarter after trailing for the two previous quarters. Last quarter, it missed estimates by reporting a loss of 23 cents per share against an estimate of net loss of 8 cents per share. The quarter before that, it missed expectations by one cent.

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A Look Back: In the third quarter, the company swung to a loss of $274 million (60 cents a share) from a profit of $63 million (14 cents) a year earlier, missing analyst expectations. Revenue rose 26.9% to $13.81 billion from $10.88 billion.

Here’s how Amazon.com traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

amzn

Wall St. Revenue Expectations: On average, analysts predict $22.28 billion in revenue this quarter, a rise of 27.8% from the year-ago quarter. Analysts are forecasting total revenue of $62.1 billion for the year, a rise of 29.2% from last year’s revenue of $48.08 billion.

Stock Price Performance: Between October 25, 2012 and January 23, 2013, the stock price rose $45.19 (20.3%), from $222.92 to $268.11. The stock price saw one of its best stretches over the last year between November 15, 2012 and November 26, 2012, when shares rose for seven straight days, increasing 10.4% (+$23.02) over that span. It saw one of its worst periods between September 19, 2012 and September 26, 2012 when shares fell for six straight days, dropping 4.6% (-$12.01) over that span.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 31.2% over the last four quarters.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.04 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.08 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 15% to $12.61 billion while assets rose 11.2% to $13.12 billion.

Analyst Ratings: With 23 analysts rating the stock a buy, none rating it a sell and seven rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)