The holiday season was very good to Amazon.com, Inc. (AMZN) as the world’s most recognized online retailer reported fourth-quarter EPS and sales that soared year over year and beat expectations.
A day after Apple introduced the iPad, which is likely to be big competition for the blockbuster Kindle eReader, AMZN announced that net sales jumped 42% to $9.52 billion, compared to last year’s $6.7 billion.
Earnings per share came in at 85 cents, or approximately 18% better than the Zacks Consensus Estimate at 72 cents. (This was the company’s 14th straight quarterly positive earnings surprise.)
For the full year of 2009, Amazon.com reported a 28% increase in net sales to $24.51 billion with earnings per share of $2.04, topping last year’s $1.49. The Zacks Consensus Estimate for the year was at $1.89.
For the first quarter, the company now sees net sales between $6.45 billion and $7 billion, which would be up 32% to 43% from last year.
Our long-term recommendation on Amazon shares is ‘Outperform,’ reflecting the strength in the company’s earnings momentum. We continue to view Amazon’s competitive position favorably thanks to its growing international business, favorable business mix, solid financials and market position.
Its earnings estimates have yet to reflect this quarter’s performance, but at the moment the Zacks Consensus Estimate for 2010 is at $2.62 per share. The 33 covering analysts for that period have been steadily advancing that guidance for weeks.
In the past 30 days, ten analysts have revised higher, which pushed the consensus up by 2.3%. However, almost 2% of that advance has come in just the past 7 trading days.
Look for more in-depth analysis on Amazon.com’s quarter soon….
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