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Why Amazon Crushes Apple as an Investment

Not sure why it is easy to see why Amazon outperforms Apple.  One makes boatloads of money and the other does not.  One trades at a 1400 pe and the other 14.  I can see no reasonable basis why Amazon trades at a 1400 pe. None.

You can't take the quantitative at face value like that. Otherwise, you'll wind up on the less lucrative end of this:

AAPL ChartAAPL data by YCharts

That's the one-year look. To be fair, here's the two-year chart:

AAPL ChartAAPL data by YCharts

And the three-year:

AAPL ChartAAPL data by YCharts

Only on the five-year chart, without nearly as much Steve Jobs' health-related concern on the front-end, does the comparison look better:

AAPL ChartAAPL data by YCharts

Because quant models don't mean a damn thing when external forces come into play. External forces such as confidence in the CEO. Follow the line of stock performance and the healthy, steady CEO at the helm explains the variation between AAPL and AMZN a million times better than traditional Wall Street analyst quantitative price target models do.

Both companies took over the world. AAPL has traditionally impressive financial metrics. AMZN does not. But AMZN blows AAPL away as an investment (though, granted, AAPL hasn't been all that shabby). The only way to explain this is to look at the narratives -- both in the rearview mirror and visioning what lies ahead -- which, of course, are highlighted by two strong CEOs and one who doesn't necessarily expire confidence the second he walks on stage.

Put forth any company, particularly battleground names and/or high flyers (e.g., Netflix (NFLX), Best Buy (BBY), Hewlett-Packard (HPQ)), and I can trace the company's story -- past, present and possibly future -- alongside stock performance. That's why, now more than ever, as TheStreet's Nicole Urken explained last week on CNBC, we exist in a stock picker's market.

You can't run stock screeners and come up with investment ideas any longer. You might as well buy a dartboard, darts and a bottle of gin. You have to think. Novel idea I know. But, if there's any justice in the world, 2014 marks the year where "thought" and "thoughtfulness" returns to the financial media, the rest of the media, the market and any other entity you deem bleeped up.

--Written by Rocco Pendola in Niagara Falls, New York

Stock quotes in this article: AAPL, TWTR, AMZN, GOOG 
Rocco Pendola is a columnist for TheStreet. Pendola makes frequent appearances on national television networks such as CNN and CNBC as well as TheStreet TV. Whenever possible, Pendola uses hockey, Springsteen or Southern California references in his work. He lives in Santa Monica.

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