By Noel Randewich and Saqib Iqbal Ahmed
SAN FRANCISCO/NEW YORK (Reuters) - Wall St breathed a sigh of relief on Thursday after Amazon.com's
A 19 percent plunge in Facebook shares
Facebook late on Wednesday warned about a margin hit as revenue growth slows and user privacy costs climb.
The social network's dismal forecast followed a disappointing report by fellow FANG company Netflix
"Even though we had a bump in the road with Facebook and Netflix, we're not derailing the tech story," said Synovus Trust portfolio manager Daniel Morgan after Amazon's report. "It's a huge sigh of relief."
Following its upbeat report after the bell, Amazon's stock rose 3.2 percent to a record high $1,866, more than making up for a 3 percent loss during Thursday's trading session.
As Amazon expands into grocery retail through its acquisition of Whole Foods Market last year, and as more businesses move their IT departments onto its cloud infrastructure, its stock price has been red hot. Amazon recently traded at 110 times expected earnings, compared to more-profitable but slower growing Apple's valuation of 15 times earnings.
Amazon's stock market value has surged more than 50 percent in 2018 and is now above $900 billion, closing in on Apple's $955 billion market capitalisation.
(Graphic: Big Five Market Cap - https://reut.rs/2JUqwpy)
In its report, Amazon forecast operating income of between $1.4 billion and $2.4 billion for the third quarter, beating analyst estimates of $843 million. The Seattle-based company's total net sales rose 39 percent to $52.89 billion, missing the average analyst estimate of $53.40 billion.
(Graphic: Big Five Revenue - https://reut.rs/2LDAy3f)
"Since Amazon hit $1,000 a share, we've taken some money off the table, but we're not selling today," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. "Of all the tech companies, Amazon to me is the most vital. It's the one with the brightest future."
(Reporting by Saqib Iqbal Ahmed; Editing by Meredith Mazzilli and Sandra Maler)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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Updated Date: Jul 27, 2018 05:05:12 IST