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Sarhan Capital CEO: The Noose Is Tightening Around Amazon's Neck

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Sarhan Capital CEO: The Noose Is Tightening Around Amazon's Neck

When asked for expectations ahead of the Amazon.com, Inc. (NASDAQ: AMZN) earnings report, Sarhan Capital CEO Adam Sarhan told Benzinga that while the company’s P/E ratio is off the charts, it also has a history of selling investors the future.

Selling The Future

He explained that Amazon keeps telling investors that it will be able to monetize everything its doing in the future.

“They still haven’t shown big improvements in that department, but they’ve got great salesmanship, and that’s all that matters when it comes to the future,” he said.

Investors want to know when the company will be able to monetize and start putting up some good growth numbers, Sarhan said.

Related Link: Piper Jaffray's Gene Munster: Amazon Top Pick For 2015, Despite Having Spent Like 'Drunken Sailors' In 2014

The Noose Is Tightening

He does think that Amazon.com will provide some good guidance because it knows that shareholders are very important to the company.

“More importantly, Amazon knows it can only push its luck so far,” he said. “The noose is tightening around its neck.”

Show Investors A Strong ROI

If the company is able to perform, raise guidance and show investors a strong return-on-investment, Sarhan said the stock will react very well.

If Amazon just keeps kicking the can down the road, he warned, investors’ patience is running very thin.

Shares of Amazon were mostly unchanged in Thursday's session.

Brianna Valleskey contributed to this report. 

 

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