I think maybe you underestimate the legion of decision-making employees beneath him in the management hierarchy. And apparently so does just about everyone else, judging by the gross disparity in compensation. Of course I'm just guessing at the disparity, but I would bet that compensation levels fall precipitously immediately beneath him, well beneath the relative contribution of those subordinate employees. I think the aggrandizement of top executive contribution to the bottom line and the corresponding pay is way out of whack.
i guarantee you there are many in those ranks who have earned 10s of millions and more. Prior to the announcement of him becoming CEO, had you ever heard of this guy? Yet he paid 300mm.
For sure. But the "rules" are basically different when it comes to comp from creating value vs comp from trading. For creating value it's generally seen as fair that you get a cut of the value you helped create, for trading it's all about risk adjusted return. I don't disagree that in some cases executives didn't actually create the value they attribute to themselves, don't know enough in this case to proffer an opinion.
Personally, I'm bearish on AMZN. However, I can't time it. Only thing I have left timing wise is I'm expecting September to be a down month. That's all I got. I'm seeing indications of increasing customer dissatisfaction with Amazon. Internally, 3rd party logistics/trucking companies are revolting against Amazon but the numbers are not large enough to make a dent. Even with worker shortages, Amazon is still able to stay fully staffed despite horrible labor conditions and low morale. Consumers would gladly go with alternatives. However, everything else is a distant 2nd and 3rd. Walmart can't get delivery right and ebay's return policies still are not good enough. The core of Amazon's consumer facing power is fast and consistent delivery combined with fairly good return policies. That's it. Customer service has eroded beyond redemption and Amazon is choking off product selection through their own predatory practices. If Walmart could get their act together then they would be a real threat. But, we all know that isn't going to happen.
I wouldn't be too bearish, Amazon is 3 companies really. I have to think "the sum of the parts" will always be priced in. AWS is a cash-cow, E-commerce you just covered, but the one part I've noticed that never gets too much attention is their... whatever you want to call it... consumer electronics division. Its the market leader in consumer home-based AI products. Alexa has almost 75% of the home speaker market, and the rest of their stuff controls everything from camera's, to HVAC and complete home energy management. Smart homes are all the rage and in this regard once again, Amazon is, well... Amazon. They don't break out numbers for this, but make no mistake, its the "hidden" 3rd division. History has shown time and again that when you break up giants, over time enormous shareholder value is created. Guessing where the price of AMZN stock is heading by guessing what consumers buying habits will be for an upcoming holiday season or what Wally World is up to.... naaaa... if I were managing billions, I'd add on every 7% dip.
AWS is only between 10% to 13% of AMZN's revenue and it here is the trend for that growth: (Infographic is from 2019 but still reflective of AMZN's current state)
Yeah lol... but AWS is 47% of their operating income. Operating income is basically gross profit right? I mean when 14% of a division's revenues equals 47% of an organization's gross profits... on total revenue of $400 billion dollars(!).... that's the definition of a "cash-cow" imo. And note, they keep plowing money back into e-commerce. Land, buildings, trucks, drones, naked lady tee's... blah blah blah.... I see no problem whatsoever in forgoing near term profits for the accumulation of land, the building of "smart warehouses", and the logistical nuts and bolts required to make same day delivery a reality for 70% of our populace. BECAUSE... just like AWS has proven itself to be... all this physical infrastructure can be all be leveraged to other entities. Wally World will be a customer. Matt it's pricey, I am well aware... but what isn't? Look at the bs people are buying. AMC.... what a effing joke. GME. Gimmee a break. The AMZN balance sheet is rock solid and built by the finest accounting brains this country has ever produced. If I'm gonna pay a premium, I want to own the company that's buying land and building tomorrow's logistical infrastructure. And bearing that in mind, the sum of the parts is gravy on top, and it will keep this stock on a slow and steady upward trajectory. The worse that can happen is a gov't mandated break-up. Buy that news, because in reality, that's the best thing that can happen for the shareholders long term.