...Calculators, lemmings or frame-makers? The intermediary role of securities analysts Daniel Beunza and Raghu Garud Introduction As Wall Street specialists in valuation, sell-side securities analysts constitute a particularly important class of market actor.1 Analysts produce the reports, recommendations and price targets that professional investors utilize to inform their buy and sell decisions, which means that understanding analysts’ work can provide crucial insights on the determinants of value in the capital markets. Yet our knowledge of analysts is limited by insufficient attention to Knightian uncertainty. Analysts estimate the value of stocks by calculating their net present value or by folding the future back into the present. In so doing, they are faced with the fundamental challenge identified by Frank Knight, that is, with the difficulty of making decisions that entail a future that is unknown. These decisions, as Knight wrote, are characterized by ‘neither entire ignorance nor complete . . . information, but partial knowledge’ of the world (Knight, [1921] 1971: 199). The finance literature has not examined the Knightian challenge faced by analysts. Indeed, existing treatments circumvent the problem by adopting one of two extreme positions. In the first, put forward by orthodox economists, it is assumed that Knightian uncertainty is non-existent and that calculative decision-making is straightforward. Analysts are presented as mere calculators in a probabilistic world of risk...
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... its chief executive, Meg Whitman, boasted that “eBay is to some extent recession-proof.” As the online auctioneer’s revenues and stock price kept climbing, one of its primary rivals, Amazon.com, just limped along. How times have changed. Ms. Whitman, now co-chair of Senator John McCain’s presidential campaign, retired from eBay earlier this year as the company struggled with stagnation. Amazon, meanwhile, has emerged as one of the most vibrant and reliable retailers in the country. And in an unmistakable sign that Internet companies are indeed exposed to the gathering economic storm stemming from the credit crisis, Ms. Whitman’s successor, John J. Donahoe, laid off 10 percent of eBay’s 16,000 employees last Monday. Mr. Donahoe noted that eBay was already feeling the effects of the downturn. “This looks like it is going to be a more typical economic cycle that impacts consumer spending,” he said. “We are not immune.” That the economic crisis is washing up on Silicon Valley’s shores shouldn’t, perhaps, come as a surprise. Most tech companies are defenseless against waning advertising, business spending and consumer interest in big-ticket items like computers. Over the last three months, investors have punished tech companies like Google, Microsoft and Apple, extracting a fifth to a...
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...Amazon.com and Borders Books Professor Business 302 Management Concepts Week 4 Assignment Angela Reed Amazon Amazon is a Fortune 500 company; it is the largest online electronic retailer in America. Amazon is credited with popularizing online shopping. Amazon.com considers itself a completely customer centric company, its company values statement is: * Customer Obsession: We start with the customer and work backwards. * Innovation: If you don’t listen to your customers you will fail. But if you only listen to your customers you will also fail. * Bias for Action: We live in a time of unheralded revolution and insurmountable opportunity - - provided we make every minute count. * Ownership: Owners matters when you’re building a great company. Owners think ling-term, plead passionately for their projects and ideas, and are empowered to respectfully challenge decisions. * High Hiring Bar: When making a hiring decision we ask ourselves: “Will I admire this person? Will I learn from this person? Is this person a superstar? * Frugality: We spend money on things that really matter and believe that frugality breeds resourcefulness, self-sufficiency, and invention! Amazon was founded in 1994 by Jeffrey Bezoes; the website was launched in 1995. It began as an online bookstore, it has grown to sell many other products, such as: clothing, gourmet food, watches, jewelry, baby products and apparel, beauty products, sporting goods, music CD’s, DVD’s, video...
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...Amazon and Jeffrey P. Bezos’s concept of e-business and the benefits it provide effectively in adopting e-supply chain strategies. Bezos’ wants Amazon to deal with the technical and logistics using the same method which he implemented within his own company at one time (Cravens & Piercy, 2013). The technology is now able to play a vital role in expansion of new business areas as well as enabling organizations in minimizing its cost and work in a more precise and effective manner. Amazon offers a complete set of infrastructure and application services by renting just about everything it uses to run its own business. From rack space to its 10 million square feet warehouse as well as its computer infrastructures that includes servers, data storage to software code (Cravens & Piercy, 2013). Bezos’s new and improved innovations seem to have many on the edge as to whether his new ideas will make profit. With Amazon spending at least $2 billion dollars in the past 12 years to perfect the pieces (Cravens & Piercy, 2013). Amazon main target are smaller companies and startups, without having to incur the additional cost and for many this is a great way to start a company. But also bigger companies such as Microsoft Corp. are using Amazon’s storages services (Cravens & Piercy, 2013). Others companies such as Powersets, finds that by utilizing the services from Amazon this cut back its first year capital cost by at least half(Cravens & Piercy). Amazon’s business model is to design...
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...SWOT Analysis Amazon Strengths * Customer Relationship Management (CRM) and Information Technology (IT) support Amazon’s business strategy. The company carefully records data on customer buyer behavior. This enables them to offer to individual specific items, or bundles of items, based upon preferences demonstrated through purchases or items visited. * Amazon is a huge global brand. It is recognizable for two main reasons. It was one of the original dotcoms, and over the last decade it has developed a customer base of around 30 million people. It was an early exploiter of online technologies for e-commerce, which made it one of the first online retailers. It has built on nits early successes with books, and now has product categories that include electronics, toys and games, DIY and more. Weaknesses * As Amazon adds new categories to its business, it risks damaging its brand. Amazon is the number one retailer for books. Toy-R-Us is the number one retailers for toys and games. Imagine if Toys-R-Us began to sell books. This would confuse its consumers and endanger its brands. In the same way, many of the new categories, for example automotive, may prove to be too confusing for customers. * The company may at some point need to reconsider its strategy of offering free shipping to customers. It is a fair strategy since one could visit a more local retailer, and pay no costs. However, it is rumored that shipping costs could be up to $500m, and such a high figure would...
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...Running head: EVOLUTION OF E-COMMERCE Business 70 Student Phil Vu De Anza College Abstract In this class project, I did some research on Evolution of E-Commerce through various sources. I picked different related topics to complete the contents for the research and final paper. Evolution of E-Commerce E-commerce has evolved from online billboards to a fully functional, personalized shopping experience over the past decade. While there were admittedly a few bumps along the road, the path from 1994 through the 2004 holiday shopping season is full of crucial milestones of Internet pioneers and technology innovators. A stroll down memory lane reminds us of terms like "stickiness," "eyeballs" and "personalization" that once captured the essence of articles about what it takes to be successful on the Web. However, even as we look back at 10 years of growth, many analysts have one eye on the future and they are saying, "We've got a long way to go." A quick glimpse at the data promises much more evolution in the years to come. Forrester Research, for example, predicted American firms alone would sell US$316 billion in goods and services via the Web by 2010. That figure would more than double 2004's online spending to account for some 12 percent of all retail sales, up from about 7 percent today. ...
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...Q&A Introduction CASE = AMAZON.COM IN YEAR 2000 Version: 4/12/10 This case analyzes Amazon’s growth strategies up to June 2000, and critiques Lehman Brothers’ credit analyst Ravi Suria’s report of that month. Suria report was one of the first to be publicly critical of the cash flow prospects Amazon and the dot com sector in general. He did this because he was a credit analyst and Amazon was rare among dot coms to have a lot of debt. The case provides a variety of learning opportunities: (1) an evaluation of a company’s strategy and performance from a credit analysis perspective; (2) an appreciation of the potential value of contrarian thinking in fundamental analysis; and (3) the analysis of the type of strategies and market conditions that fueled the dot com bubble. Q1. 1.1 Regarding the long-term viability of Amazon's business per the case: What was Amazon’s original business model? (2 pts) I shall define a for-profit firm’s business model as the set of plans and strategies for the future that the firm has in place for earning at least normal profitability in the long run. Viewed through the lens of a statement of cash flows, a business model requires: Plans for financing; strategies for converting the cash raised by financing into investments of tangible and/or intangible assets; and strategies for generating abnormal profits from those assets through operations. Note that in their investing and operating activities, firms are less likely to be price takers...
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...yesterday and failed to meet analysts' expectations. Best Buy reported revenue of $16.26 billion in the fourth quarter compared to $16.55 billion in the same period a year ago, or a decrease of 1.8%. Net income decreased by 16.4% from $779 million to $651 million. Thus, earnings per share fell from $1.82 to $1.62.This decrease largely reflects Best Buy's decision to spend $222 million in restructuring charges to focus its international efforts and drive supply chain efficiencies. Excluding restructuring charges, earnings per share rose for the quarter to $1.98 which beat analyst estimates. Nonetheless, Best Buy's stock price showed that investors were less than thrilled with the earnings news. Best Buy's share price fell 5.4% on the release of the earnings information. Best Buy struggled domestically: revenue fell 4% versus the prior-year period. Most notably, there was double-digit decline in sales of entertainment hardware and software and TVs. Consumer demand for new television technologies was not a significant revenue-generator. Where the domestic segment declined, it was offset by the 4% increase in the international segment. This increase is mostly due to new store openings and a favorable fluctuation in currency exchange rates during this time. As Benzinga readers already know, Best Buy has missed quarterly estimates badly in the last year, and is considering the possibility that it may have to lower prices to remain competitive with Amazon (NASDAQ: AMZN) and Wal-Mart...
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...Amazon Marketing Plan Lauren A. Meier Argosy University Abstract In this paper you will find the marketing strategy of Amazon. As technology has advanced and internet can be accessed essentially anywhere more and more people are turning to online shopping. Amazon.com, a retail online super center has taken advantage of this and has successfully been able to adjust and expand their consumer base. Starting as an online book retailer they have grown to selling sports gear, electronics, and many other various items. This opened several marketing opportunities and target markets for Amazon. With the release of the Kindle and the soon to be introduced set-top box Amazon is looking at a whole new playing field of competitors. Keywords: Amazon, competitors, online shopping, marketing opportunities Amazon Marketing Plan Company Overview: Jeff Bezos, founder and current CEO of Amazon.com has been committing himself to Amazon’s mission for the past 18 years. Amazon was incorporated in July of 1994 with one sole mission… “Our vision is to be earth's most customer centric company; to build a place where people can come to find and discover anything they might want to buy online.” Almost exactly year later Amazon.com had sold their first online book, "Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought." With their headquarters located in Seattle, Washington and a support system of over 88,400 full and part-time employees; Amazon...
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...Amazon vs. eBay Choice of Investment James Reitnour Strayer University ACC 557 Professor Frank Gorbey September 2, 2013 Amazon vs. eBay Choice of Investment Deciding between two stocks to invest in can be like attempting to predict what number will come up next on a roulette wheel; it is a gamble to say the least. However, by following the first major rule about investing in a company, namely doing your homework, it is possible to make an informed choice between two companies. The choice is down to two internet based behemoths, Amazon and EBay. A Comparison of the Companies The first company, Amazon, was founded in 1994 by a former Wall Street vice-president looking to capitalize on a report that at the time projected the growth of the web twenty-three fold annually (Funding Universe, 2013). After narrowing down a list of 20 products that could easily be sold online to the most promising five, the product to be sold first was books due to the sheer number in print and the proximity of a major distribution hub nearby. Within four months of the website launch in July 1995, Amazon had become a very popular site. The key to their success was the fact they only stocked a small number of items in their warehouses, while using outside sources to provide the remaining products. This model is still in use to this day. Amazon went public in May of 1997 with an offering of 3,000,000 shares. The money was used to expand the distribution network to a facility in Delaware;...
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...Amazon Amazon is Britain's most influential retailer - and it doesn’t even make a profit Amazon has become the biggest online retailer in the world and the most influential retailer in Britain, here are a couple of questions that shine a different light on the company. When it generated sales of $15.7bn (£10.1bn) in its most recent quarter to June 30, how big were Amazon’s profits? Zero. It made a net loss of $7m.Given the retrenchment of retailers such as Tesco from the electrical market because of the growth of online sales. What share of the UK electrical market does Amazon have? Every retailer in the country – from Tesco to the corner shop newsagent – talks about how they are battling to evolve their own business to cope with the growing influence of the Seattle-based company. The mighty Tesco has been forced to admit its biggest hypermarkets are outdated and overhaul its non-food range, Comet and HMV have fallen into administration, newsagents have installed lockers where shoppers can collect Amazon orders, and people are now reading books on their Amazon-made Kindles. Even those retailers operating in sectors that Amazon does not currently serve – such as food and fashion – are worried about what happens when it starts. At the same time, so many uncertainties remain about the future of Amazon, launched in 1995 as an online bookstore. The row around the lack of corporation tax paid by online multinationals such as Amazon tended to miss this pivotal point – which...
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...2.1 The Business View 5 2.2 Technical View 5 3.0 Amazon.com and Big Data 6 4.0 Identification of Amazon.com’s "Big Data" needs 6 5.0 Big Data problems to be solved and Big Data solutions 6 6.0 What are AWS (Amazon.COM web services) problems and what is the solution for it 8 6.1 Kinesis other advantages 9 7.0 Conclusion 10 8.0 References 11 1.0 Background description of Amazon.com History Amazon.com, Inc. (Amazon.com) serves consumers through its retail websites and focus on selection, price, and convenience. The Company offers programs that enables sellers to sell their products on its Websites and their own branded Websites and to fulfill orders through them , and programs that allow authors, musicians, filmmakers, application developers, and others to publish and sell content. The Company operates in two segments: North America and International. The Company serves consumers through its retail websites, and focus on selection, price, and convenience. The Company designs its Websites to enable millions of products to be sold by the Company and by third parties across dozens of product categories. Customers access its Websites directly and through its mobile Websites and apps. It also manufactures and sells Kindle devices. In October 2013, Amazon.com Inc acquired TenMarks Education Inc. Effective February 5, 2014, Amazon.com Inc acquired Double Helix Games LLC. Amazon.com is a Fortune 500 e-commerce company based in Seattle, WA. Amazon was one...
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...Chief Operating Officer Eric Gunho Bae - Chief Risk Analyst The Blue Chip Investment Company Blue Chip Investment Company is a stock management firm that aims to produce superior investment returns by aggressively seeking capital appreciation in rising markets. The Blue Chip investment Corp. was founded by Eller MBA’s Prag, Neil, Archana, Shalini, Eric with an initial investment of $250,000 from each stakeholder. We endeavor to maintain a portfolio of stocks that generates high profits over a short period of time for the stakeholders. Our goal is to maximize stakeholder wealth by making opportunistic short-term investments based on proactive investment research and a disciplined strategy. Our Strategy Our company’s short term strategy is to invest in US Retail industry’s top performing stocks. We are specifically targeting the high retail stock returns during this US holiday season. The US Retail Industry The National Retail Federation (NRF) estimates that U.S. retail sales will rise 3.9% during this holiday season, overshadowing last year’s growth of 3.5%. Sales during the months of November and December are estimated at $602.1 billion. NRF also forecasts a 13%-15% rise in online holiday sales to $82 billion, stronger than the 11.1% growth seen during the 2012 season. Stocks selected Companies we chose to invest in are Walmart, Target, Macys, Amazon. These retail companies have been around for years, and doing good business. Moreover these companies are industry leaders who’re...
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...Amazon.com’s E-Business Model Amazon.com was founded in 1994 as an online book retailer. Now, the largest retailer of books has also become the largest online retailer with a customer base of over 30 million people. Amazon competes in a vast array of markets including: books, movies, digital readers, computers, consumer electronics, pet needs, groceries, health and beauty aids, toys, clothing, jewelry, shoes, sporting goods, tools, automotive, hardware, building supply, and more. Despite their large product offering, Amazon has maintained its strong brand. Imagine if Toys-R-Us, the largest toy retailer began selling books or if the NBA began selling hardware online. The threat of consumer confusion would rise, thus bringing into question the value of the Toys-R-Us and NBA brands. Some analysts question the wisdom of Amazon.com selling products that are typically sold in the business-to-business markets. For example, you can now purchase industrial, laboratory, and scientific supplies from Amazon.com. (See Appendix – comparison and contrast chart of Amazon.com, Barnes and Noble, and Borders.) Discuss the pros and cons of Amazon’s growth and diversification of business and specialization, and make recommendations about what Amazon could have done differently. The study comprises of Amazon.com which started its history by selling books and now one of the online market leaders globally not only for books but products from various categories. Company started with a mission to...
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...analysis……………………………………………………………….……..…5-6 Internal Strengths and Weaknesses External Opportunities and Threats 4. Market-Product Focus 6-9 a. Target Markets b. Positioning c. Competitive Analysis d. Promotion Strategy 5. Inventory 9-10 6. Re-organizational Structure .10 7. Financial Analysis 11-12 8. Final Recommendation ...13 9. Bibliography Total Pages in Can Go Analysis and Recommendation .13 1. Executive Summary Can Go Inc. was founded by CEO Elizabeth (Liz) Bennet. Can Go began with an initial investment from Liz’s stock option and the help of Warren Fox (MBA classmate). As a start-up company and joint efforts from Liz and Andrew, the expansion of its operations included CDs. DVDs, audio and video tapes and customized MP3 players. Can Go, Inc. listed as an online retailer of books and audio/visual entertainment took a leap into the online gaming arena whereby 50% ($25 million) of their divisional revenues was a direct result of this new venture. Can Go’s net sales revenue peaked at $50 million for its 2010 facial period. As Can Go strives to garner a major position in entertainment e-commerce, the online gaming is becoming highly popular. The trend shows the market shares are rising quickly and so are companies like Nintendo and Electronic Arts that took only a few years in the online gaming business to “make hundreds of millions” (Software Top 100, 2010). Can Go was recently...
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