Piper Jaffray: Amazon Top Pick For 2015, Despite They Having Spent Like 'Drunken Sailors' In 2014

E-retail giant Amazon.com, Inc. AMZN is all set to announce its fourth-quarter results after the closing bell today. Piper Jaffray analyst Gene Munster was on CNBC Thursday to discuss what investors should expect from the results and why Amazon is his top pick for 2015 despite investor worries of company spending too much.

 

Why Is Amazon Your Top Pick For 2015?

 

“Well really there’s two key things going on,” Munster said. “First is they are in a pole position for a secular growth [even] in e-commerce, everyone knows that, but I think that sometimes that important top-line revenue opportunity gets lost because the second big issue which really over-looms investors thinking on this which is profitability.”

 

He continued, “They have spent like drunken sailors in 2014 and that has really impacted the belief that this story actually has margin leverage and I think that what it’s going to happen in 2015 is we’ll see some fractional improvements in margins and I think those fractional improvements are going to be encouraging to investors and positive for the stock in 2015.”

 

Even Though You Are Positive, Why Do You Expect Amazon To Issue A Margin Outlook Below Street’s Estimates?

 

“Right, that’s for this quarter and for next quarter. I think, the important part is that how that progresses throughout the year, that’s our opinion is. Now is the great time to own it because everyone is anticipating that margin below where the Street’s at. So, they always guide below the Street, you have to look at what the ranges are, it gets a little bit complicated, but I think it’s safe to say that as investors are expecting that, we don’t see downside to the stockbased on that,” Munster added. 

Posted In: CNBCMedia

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.