NEW YORK (TheStreet) -- Amazon (AMZN - Get Report) hit a one-year high of $407.80 on Tuesday and the stock closed at $407.05, a 1.86% or $7.44 increase from its previous close of $399.61.
The stock had a volume of 2,659,961, slightly less than its average of 2,973,890. It had a low of $401.60 for the day and has a one-year low of $245.75.
The Wall Street Journal reported Tuesday through sources familiar with the matter that Amazon is considering starting its own online pay TV service, and the company has reportedly reached out to at least three media companies about content for the service. The news broke hours after Intel (INTC) confirmed that it would cease its plans to launch its own online pay TV service and would sell its Intel Media property, which had been working on the project, to Verizon (VZ).
TheStreet Ratings team rates Amazon as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate AMAZON.COM INC (AMZN) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 8.0%. Since the same quarter one year prior, revenues rose by 23.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Net operating cash flow has increased to $1,389.00 million or 47.29% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 36.90%.
- Powered by its strong earnings growth of 85.00% and other important driving factors, this stock has surged by 47.17% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Internet & Catalog Retail industry average, but is greater than that of the S&P 500. The net income increased by 85.0% when compared to the same quarter one year prior, rising from -$274.00 million to -$41.00 million.
- The gross profit margin for AMAZON.COM INC is currently lower than what is desirable, coming in at 32.53%. Regardless of AMZN's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -0.23% trails the industry average.
- You can view the full analysis from the report here: AMZN Ratings Report