Amazon: Why I'm Bullish But Uncomfortable Buying Now (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• I had rated Amazon a 'Neutral/Hold' last June but upgraded it to a 'Buy' at the end of Jan this year, capturing +3.96% in active return.
• Now, I'm revising that to a 'Neutral/Hold' again as I note merely adequate growth in its E-commerce segment and reasons to be cautious given the proximity to 4-monthly resistance levels.
• This is balanced by my bullish outlook on AWS, which I think is well-poised for growth reacceleration as enterprises increase their tech spend allocations.
• I also think we will see further margin expansion in the stock as the company implements a host of improvements in logistics and advertising, benefiting e-commerce EBIT margins.
• On the risks side, higher capex and equipment lease expenses are expected to generate AWS growth. I am watching the AWS margin and overall FCF figures for signs of downside surprises.

Read the full article here.