Tag Archives: Amazon

The Best Part About Amazon Buying Whole Foods Is That It Turned Out To Be FREE!!!

LINK: Amazon the Everything-Everything

Last week Amazon (AMZN US) announced that it would be buying Whole Foods (WFM US).

What most people don’t realize, it that it basically bought it for free.

How?

Well, Amazon’s buying price for Whole Foods is approximately $13.583 billion.

Before the announcement, Amazon’s shares were trading at $964.17. Yesterday they closed at $992.59. Amazon has 478 million shares outstanding. Therefore, the change in share price was worth…

$13.585 BILLION – which is MORE than what they paid for Whole Foods!!!

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Big Tech Is Doing Very Well

We have been taking some profits on big tech recently, but the numbers in this link show why big tech share prices have done extremely well over the past year:

LINK: Big Tech Earnings and Revenue Growth


Are you surprised that Facebook grew its profits the most? We’re not. It validates the point that their network is a brilliant platform that has only begun to be monetized.

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We Have Been Selling

In our January commentary (LINK): Our January Results), we said the following:

Looking at the broader market, all major US stock indices are at all-time highs. On the other hand, the Volatility Index (VIX), which expresses anticipated market volatility, is at historical lows. Although we have been taking profits on some of our high-flying stocks, we do not intend to try to time the market by selling stocks that we like in the hope of buying them back more cheaply in the future. This is called being ‘cute’. ‘Cuteness’ is the domain of babies and puppies, not investment managers.

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Amazon reaches new highs

It seems that Amazon is unstoppable. Of course it isn’t but it may seem so.

There are plenty of articles that help Amazon go even higher, such as:

It’s most ambitions sports deal to date Amazon wins streaming rights to 10 NFL games

Amazon launches Amazon Cash, a way to shop its site without a bank card Link

Also, absence of bad press helps.

We’ve been writing about Amazon for quite some time and perhaps mentioning it too often. It’s been very profitable position for our clients and we’re still bullish.

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Amazon, Facebook, Google Could Replace Banks

medici zuckerberg

Banking has a fascinating history, and has played a seminal role in the forging of the modern world.

Today, as banks furiously try to keep up with technologies and new ways of attracting and maintaining clients, it bears consideration as to what their roles will be in the future. Will they fall pray to today’s aggregators and connectors? Quite possibly.

In a world where more and more of your everyday purchases are sourced from Amazon, why not carry a balance on your Amazon account? Surely they could come up with enticing reasons for you to do so. Looking for a loan? Surely Google could personalize and rank your best options. Need to make a payment? Facebook has a decently sized network of users (1.6 billion and counting)…

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Amazon’s Way to the Top

Only ten years ago, four of ten largest companies in the world by market cap were from oil and gas industry and only one tech company (Microsoft) was included in the list.

As of December 30, 2016, five of ten largest companies in the world are tech companies and only one is from oil and gas industry (Exxon Mobil).

Top 10 companies by market cap
Rank 2006 2016
1 Exxon Mobil Apple
2 General Electric Alphabet
3 Microsoft Microsoft
4 Citigroup Berkshire Hathaway
5 Gazprom Amazon
6 Industrial and Commercial Bank of China Exxon Mobil
7 Toyota Motor Corporation Facebook
8 Bank of America Johnson & Johnson
9 Royal Dutch Shell JPMorgan Chase
10 BP General Electric

Source:Bloomberg

Right now we are not interested in the demise of oil & gas companies or decrease in the number of banks between top ten companies. We would like to turn your attention to tech companies.

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