Submitted by OliveInvestor t3_10p6slc in wallstreetbets
With Amazon's fourth-quarter 2022 results, set to be reported on February 2nd, expectations are high for the company's financial performance. The company is forecasting net sales between $140 billion and $148 billion, with growth expected to be between 2-8% from the previous year's quarter. Analysts at Zacks Consensus Estimate predict net sales of $145.37 billion, a 5.8% increase from the prior year, and earnings per share of 15 cents, a decline of 89.2% from the previous year.
The good
Despite this decline in earnings per share, Amazon's holiday performance was a standout, boosted by strong initiatives and record-breaking sales from its selling partners. The company's expanding distribution network, Prime-enabled fast delivery services, and robust grocery offerings all contributed to the quarter's success.
Prime Free One Day service, Amazon Fresh, and the strong two-hour delivery service from Whole Foods Market drove customer momentum in the quarter, while the expanding Same-Day Delivery service for Prime members only added to the positive results. Amazon's growing global e-commerce business, expanding Prime footprint, and aggressive stance on physical presence all helped contribute to the quarter's performance.
Streaming services such as Prime Video and Amazon Music also saw solid momentum, with expanding original content and overall content portfolios driving Prime engagement. The expanding Amazon Web Services portfolio, robust Fire products family, Echo smart speakers, Blink doorbells, and Eero products all contributed to the quarter's results, along with strengthened Alexa features.
The bad
Growing inflationary pressures and a slowdown in online shopping could pose risks to Amazon's fourth-quarter performance.
Tech stocks which are leading the market rally in 2023 with Nasdaq on pace to record its best January since 1999 may face some downward pressure in the week ahead as the Fed meets and Apple posts earnings.
Implied move for AMZN is +/-7.3% but historically the expectations have been higher than the past average.
Trade idea
A bull put spread will capture some of the upside potential but also protect against a dip if the price moves in the wrong direction. This one for example makes 5% yield (22% annualized yield) unless AMZN falls below $85 at maturity (-15% move from current price).
Buy 1 $75p, Buy 1 $80p, Sell 3 $85p, all expiring 4/21/23
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capital required to cash secure: $9,571.30
VisualMod t1_j6ik50v wrote
^^Discord ^^BanBets ^^VoteBot ^^FAQ ^^Leaderboard ^^- ^^Keep_VM_Alive >TL;DR: Amazon is forecast to report strong fourth-quarter results on February 2nd, driven by growth in its e-commerce business, expanding Prime footprint, and aggressive stance on physical presence. However, inflationary pressures and a slowdown in online shopping could pose risks to the company's performance.