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Why You Should Sell Amazon's Stock to Buy Microsoft's

Still, analysts estimate Amazon will exceed Microsoft's $84 billion in revenue this year and may top $90 billion. The question is, how much longer can Amazon continue growing at the current rate. At some point, the law of large numbers creates such an obstacle that each dollar of sales increase requires exponentially greater marketing dollars, which creates pressure on profit margins. 


AMZN Revenue (Annual) Chart

Shouldn't have Amazon's previous efficiency investments from 2000, 2001, etc. started to pay off and boosted earnings in 2012, 2013 and now in 2014? They should have, and the stock's precipitous fall from $400 demonstrates a growing uneasiness from shareholders that the greater fool theory may be coming to a head.


AMZN Operating Income (Quarterly) Chart

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SYM TRADE IT LAST %CHG
AMZN $434.72 -0.30%
MSFT $43.86 -1.20%
AAPL $125.14 -0.68%
FB $86.24 -1.50%
GOOG $518.92 -0.75%

Markets

DOW 17,592.05 -91.53 -0.52%
S&P 500 2,065.43 -3.33 -0.16%
NASDAQ 4,968.5940 -23.3460 -0.47%

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