AMZN
Amazon.com, Inc.
$284.02
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 7.3% above fair value
You pay
$284.02
Bear
$179.56
Fair
$264.67
Bull
$354.81
Bear
$179.56
-36.8%
8% stage 1 growth, 12% discount
Fair
$264.67
-6.8%
13% stage 1 growth, 12% discount
Bull
$354.81
+24.9%
17% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
37%
Implied Market Multiple
28.8x
Market is pricing in (growth)
15.8%
vs 13.2% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $322.68 from 94 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $264.67 per share.
Warnings
This company spends 18% of revenue on big investments like data centers and infrastructure, mostly for growth. We adjusted the cash flow figure to only subtract the upkeep costs, giving a clearer picture of true profitability.
Wall Street's average price target is $322.68 (from 94 analysts). Our estimate is 28% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions