How low Could the Amazon Stock Price Fall?

Companies / Amazon May 16, 2022 - 04:30 PM GMT

Amazon $2485 : PE 46.7: EGF -68% : EC 332

Amazon Crashed 10% on BAD earnings as Amazon delivered an EPS of -$7.56 vs $8.73 expected, why were Amazon's earnings so bad? It's because the US is going into significant economic slowdown that increases the odds of a recession being declared this year!. Amazons PE before earnings was 43.7, AFTER earnings and the price plunge the PE is 46.7, That's right AMAZON is MORE EXPENSIVE AFTER the PRICE DROP THAN BEFORE! Pay attention here and learn a valuable lesson not to just buy a stock because it drops! For amazon to trade at a PE of 43.7 the stock would need to drop to $2325.

How low could Amazon fall?

I would not be surprised if Amazon trades down all the way to to $2000 so there is plenty more downside in this tech giant to weigh down on the markets.

Amazon stocks buying Levels are $2412, $2346, $2266, $2167, $2032 (I am only buying small). I am now 39% invested up from 28%, however I have decided to decrease my target exposure by about 25% so my current exposure jumps to 51%. And I am only going to continue to add via small buys as the stock price falls towards $2,000!

The bottom line is I have always classed Amazon as being a dubious stock, to much financial engineering going on which is why I stated that I don't trust it's EGF of 71% and is a stock that I don't entirely understand. Still the stock is prone to strong trends higher on very high multiples and does have a tendency to spike higher which means there is a good probability that Amazon will eventually trade to new all time highs Basically I don't really like Amazon, which means on a spike above $3000 I will once more seek to sell most of that which I bought, until then I continue to lightly accumulate. I have also dropped it a notch on my AI stocks table to Number 8.

Remember folks without the benefit of hindsight, buying levels are the next best thing, keeps one out or light until deep deviations materialise, else one would be like the many fools peppered on youtube who thought Amazon was a good buy at $3000 just because they announced a stock split such as this clown who dumped $60k into Amazon at near $3000 a share.

For just $4 bucks per month he would now be over $10k better off and there are countless examples of such lemmingesk behaviour following Amazon and Alphabets stock spit announcements as if it were a signal to go ALL IN on these stocks for no fundamental or even technical reason.

What's the odds this fool will soon SELL ALL at a MUCH LOWER PRICE, at $2100? I'll update if I see such a video.

The rest of this analysis that warned that Apple and Microsoft were on the precipice of breaking lower Why APPLE Could CRASH the Stock Market! that was first made available to patrons who support my work.So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $4 per month. https://www.patreon.com/Nadeem_Walayat.

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By Nadeem Walayat

http://www.marketoracle.co.uk

Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

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