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Your Valuation
10 June 2008 |
133
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Valuation Details
| Member: | TheCrunchBlog |
| On: | 26 Sep 2008 |
| Views: | 133 |
| Comments: | 1 |
| Updated: | 6 hours ago |
| Ticker: | AMZN |
| Market: | NASD |
This valuation is part of this blog post:
http://blog.valuecruncher.com/2008/09/running-the-numbers-amazon-amzn-still-looks-expensive/
Our assumptions are revenues of US$19.5 billion in 2008 growing to US$30.5 billion in 2010. We have used an EBITDA margin of 7% in 2008 increasing to 8% in 2010. We used a terminal growth rate of 5%. We used a terminal capital expenditure number of US$375 million. We have used a WACC (discount rate) of 10.5%. All of these assumptions can be amended in the Valuecruncher on-line valuation model to adjust the valuation.
Our analysis incorporates the cash and debt on the $AMZN balance sheet – Valuecruncher calculates a net debt number.
Based on our analysis the current share price looks expensive. We recognise that $AMZN has a range of potentially valuable growth options (especially their Web Services platform). Currently it is very difficult to determine a value of these growth options – we have made a broad attempt with our growth projections and terminal growth rate. However, it appears that these options are being valued into the current share price at a level beyond what we are projecting.