ZCode System Reddit and Sports Betting

Do you like sports? Well, today is your lucky day, because that passion is going to make you earn a lot of money. And don't worry, you won't have to leave your chair to get it.
The answer is in sports betting. That industry that moves millions of dollars a year and that you have probably tried sometime (who doesn't want to have a little fun from time to time?).
You will think that I am crazy and that betting is just luck sometimes. But as you may have seen, in recent years there have been different methods (some very strange!) Of making money online.
And sports is no exception.
Just by making an accurate forecast and betting some money, you can generate good profits in no time and without doing ANYTHING. You will be sitting on the sofa watching the game you bet on to see how much money you will win. Cool, huh?
You can have a beer with your friends, enjoy the great game of the week on your TV, and with the good money that you will get from the bets, maybe you invite.
Don't worry, it's not like you should be a super fan or know everything about the teams. Now there is a platform that will take care of all that work and will tell you the forecasts you should make.
At first, I thought it was not a good idea, but after thoroughly researching the Zcode System platform, here I bring you all the information you should know if you also want to start generating income by betting. Go for it!

What is Zcode System?

Zcode System Review 2020
Zcode System is a sports betting robot specially designed so that you can earn money with the sports that you like so much. This system gives you such accurate predictions that you can really make good profits by betting.
The truth is that for some time I had found out about this site that allows you to do business with betting, but I never paid attention to it. What a mistake I made!
This is a system developed by a group of sports and math fans (a rare combination) who looked for ways to earn money from many sports matches. And they really nailed this formula for predicting the final results of the games.
Keep in mind that they have been in this market since 1999, almost 20 years!
With such a good reputation, they created a huge community on Facebook and started making public predictions, where the people who followed them made a lot of money. Thus they managed to gain more than 12,000 followers on that social network.
Admittedly, they looked for a big mess when making these public forecasts, since many companies that make their living with the bets and the losses of the people, found it difficult to see such good results.
Of course, Zcode System does NOT make predictions for all sports, only for basketball, baseball, American football, and NHL (hockey).
Why? Well, because they are the sports in which more people bet. A lot of money moves in these games so you have to take advantage of it.
In addition, there are many other sports that are only played during short seasons, instead, these that I mentioned are present ALL year. This way you ensure a good income during the 365 days.
It took the Zcode System team years to find the correct and automatic way to do these mathematical calculations in an easy way so that any user can understand their predictions and bet.
The best thing is that they used a good number of parameters to make everything more precise, find the correct value of the bet and win much more money.
Since the more accurate the bet you make, the more benefits you will have. You do this with answers to questions like "how many goals are going to be scored?", "Which player will score?", Etc. Even in these types of questions, Zcode System answers you.
However, something so good cannot be available to everyone. If so, the sportsbooks would take notice and the value or winnings would drop drastically.
Therefore, Zcode System only has a limited number of memberships that will be sold out very soon. I recommend that you do not be so indecisive and take advantage of this great opportunity.
>Access Zcode with a discount

I'm a bit lazy... How can I make money with Zcode system from my chair?

Zcode is a super friendly online software that will let you know how to bet on a match and win money. In fact, you just have to review their predictions, enter the betting page you want and place the results they gave you along with the amount you want to invest and that's it! Earned money.
However, I must tell you that as always, you start with little money. It is never good if you put a high amount at risk.
You can be guided by the classification that the system places on the predictions. It consists of 1 to 5 stars, the higher the number of stars, the more confidence in that prediction.
Likewise, it has many tools so that you can study those predictions and reduce the risk of your bet. The best part is that they are free!
Every day the system searches and collects information on all teams, matches, events, to study the games that are currently presented, and since it has so many filters, it only takes into account the precise and correct information so that your investment does not get lost.
The recommendations that Zcode System gives you are about where you should invest, which team is going to win, with how many goals or points, conditions of your victory, that is, you can make several investments at the same time.
It's like having your own genie from the lamp trapped in the computer and giving you the right answers.
With this information and having wagered on the conditions recommended to you, you can sit down and have a coffee while waiting for the end of the game to collect your money. It's just placing your bet and winning!

What betting tools does Zcode have to win?

1. Zcode Line Reversals

At Zcode they have sought to make it even easier for the community that uses their system to earn money. For this reason, now it has several tools available on its website, and the best thing is that they are free so that your bets are made as God intended and not adrift.
I know this first tool has a futuristic name, but it is simpler than you think.
The truth is that it has many functions since it allows you to observe the value of bets, the percentage of people who bet on a team, where the money is moving, etc.
That is, it allows you to place your money wisely. You will need it!
Zcode System Results
>Visit Zcode Tools<

2. Z-Code Oscillator

Oscillator? But no one uses that word anymore!
However, that's what this tool is called. What it does is that it will allow you to know the streaks of the team you want to bet on, as well as you can compare the teams you want.
Imagine that you can pull out accurate comparison statistics between the Chicago Bulls and Cleveland Cavaliers in a decisive game, and it allows you to win a ton of money. It is key information that it provides you, so it never hurts.
If you like to bet on teams, you cannot miss this tool, I know that it will be as useful as money itself.

3. Zcode Totals Predictor

As its name implies, the tool seeks to facilitate and predict the overall results.
https://preview.redd.it/h3hye2nkl5361.jpg?width=1030&format=pjpg&auto=webp&s=08e59b4f0f3b04f59c5fddbdee7be8f9dcdbac90
It is very useful at the time of knowing the results of basketball or rugby matches since they are very large figures compared to football. In fact, the larger the numbers, the more accurate they are. Crazy!
It may be that you use it to find out how many points the Cleveland Cavaliers will win a basketball game with and you can generate good profits with it.

4. Z-code profit oscillator per pitcher

That weird name again, but you know what it's all about. This tool allows you to know the behavior of two pitchers and compare them.
It serves you very well when you are watching a baseball game and you want to invest in the team that has the best pitchers.
It seems like a bit of cheating, but the truth is that it does not use any strange parameters, it only relates how the players have been playing, that is, their performance.
It is perfect for fans of this sport, so you will have no margin for error when betting on a pitcher.

5. “Power rankings” indicator

I really love this name, it denotes strength, control, and courage. Especially since it is a tool that is going to be needed a lot.
In case you have doubts about where to bet, it allows you to know the real situation of the team, its stability, and how the team will behave.
The higher the power rank, the better the team's behavior. It's like measuring yourself in a boxing ring and whoever is last will be the best.
Remember that there are always ups and downs, therefore the indicator will always be changing. The important thing is that you have good information before betting, lest you lose all your money by not checking the statistics (It happened to me).
>Zcode website<

How do I access the Zcode VIP membership?

Getting a Zcode VIP membership is super easy. In fact, while writing this post, one of my friends opened his account in less than 3 minutes. To avoid all the hassle of searching for the page, here is a link where you can enter immediately.
Once inside the page, you must press the button "I want to enter". Hurry up! There are few places left to acquire this great system, so doubting will not help you much.
When the posts run out, it will be a while before one is released.
You are now one step away from obtaining the best predictive betting system. In the new window, you will see a payment form that you must fill out with your information. This is your billing information, so it must be very accurate.
This form is secured by McAfee and Norton security, so there is nothing to worry about.
You have the opportunity to acquire your VIP membership for only $ 79 per month. Besides, you can also buy extra software to be a beta tester of other systems called Zcode Almanac for $ 99.
You can pay with various means, Visa or Mastercard credit cards, American Express, Discover and you also have the PayPal payment option.
Keep in mind that as soon as you have made the payment, you will be able to enter their digital platform without any problem, becoming part of this select group of bets.
It's like being part of the fight club, only here you can talk about it.

What does Zcode System include?

Once the membership is purchased, you will have access to all the information about the matches and teams. You will immediately realize that it is a complete system and that it really pays off on its own. You will be able to watch a welcome video that will easily explain how to use the platform, so pay close attention.
In addition, for becoming such a special member, they will give you an action plan that will indicate everything you must do in detail to earn money with Zcode.
Don't forget also all the free tools that you can access once you are a member. You can make many combinations to improve your betting predictions.
If you are wondering if you will be able to recover your investment, let me tell you that you will not only recover it, but you will be able to multiply it in a few days.
This starter pack will help you earn money by betting on your favorite sports, without leaving your bed! Anyone would like an opportunity like this. With this welcome you will not have to bet blindly, you will be well directed by Zcode System in this way of sports betting.

So, can I try Zcode System for free first?

Zcode system free trial and free picks
There is nothing better than trying something before you buy it, and this system is no exception. So I'll give you only one answer: Of course you can try Zcode for free before paying!
What's more, this was the first thing its creators did, by keeping their predictions public on the Facebook group.
To try Zcode System for free, you just have to click on the following link that I leave here below:
>>>Free Zcode Free Trial Access
Once you have entered the page, just click on the top menu where it says "Free tools", and when the screen appears as in the image below, write your email and click on the green button "Download! NOW!".
Then you just have to go to your email t confirm it and voila! There you will have an email from Zcode where there are links to use its tools for FREE.
However, as I mentioned before, they are about to be closed to the public and become a private group. Which means no more free predictions!
You have to be very confident for anyone to use the tools that your VIP users have. Though if you think about it, it's also a confident way of saying "I'm the best."

But if I don't like sports, what do I do?

I get you, not everyone likes hockey, basketball, football, or baseball. I didn't even like all those sports, but now that I make money with them thanks to Zcode System, I don't miss a single game anymore.
Of course, I am not going to force you to use this system if you don't like any sport. But what I can do is illustrate you.
How? Very simple, showing you why the fact that you don't like those sports is the best thing that can happen to you right now.
If you've ever bet on your favorite team in the past, and let's say it wasn't one of the best, you know what it's like to lose money by getting carried away by your emotions. Until now I see that many continue to make this mistake and it also happened to me in the past.
And I tell you this because if you do not like these sports, your emotions will not cloud your actions. This means that when placing bets you will do so with a calm and cool head.
Because we must be clear, money is what matters most. And if you can earn a good chunk of greens doing this lightly and as a hobby, well, I think that would be great.
A Jedi Master of Investing tells you: " Investing for emotion will be your downfall." So there you have it! A change in perspective that could open your eyes and make you a millionaire.

Conclusion on Zcode Review after researching for 3 months

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I can really tell you that this time I did do the Sherlock Holmes job to give you the best information about this show.
A couple of months ago I learned from a friend that a betting system was gaining fame, as it promised a lot and the investment was relatively low. Like all skeptics, I did not believe it, so I decided to search for the information myself before commenting on it.
For the past two months, I've been flipping between pages, comments, blogs, advertising, and even contacting those who gave testimonials, just to find the truth.
And well, as everyone who seeks finds, I came across a crushing reality: Not only was what my friend told me true, but it was better than I believed.
The way Zcode is designed is so cool and logical, that it doesn't lead to bets based on emotion, but on past results, comparisons, and streaks. What makes this system a supercollider of information to get an optimal and true result.
A month after the investigation I decided to prove the veracity of what I had sought. So I bought the membership.
The tools, the way in which he achieves results, how he studies the games, the players. Everything is true! The system interface is super friendly, in a little while I was able to adapt and learn how to know which forecasts to follow and which ones not, because it remembers that it classifies them by stars.
And not only that, it has a large community of sports fans who help you secure bets, and that, the Zcode page does not tell you.
It's amazing how everyone is commenting on how well they are doing and posting their earnings. They also spend time recommending the tools that have served them the most and those that you shouldn't use.
However, I have not decided to invest yet. What I did was look on television for the games that the program was predicting, to see if it was correct. I looked for 10 matches, of which he hit 8. They were all different.
Well, the last week I have been closely following the forecasting action of Zcode and the truth is that every day out of 10 it hits 7 or 8. I think that is a pretty good number.
That's when I decided to bet based on the Zcode results and I'm almost close to tripling my membership investment, it won't take long.
Keep in mind that places to access the VIP community are running out faster than I expected. People are going crazy!
And it is not for less with a system that opens the doors to bets and profits 80% of the time.
I don't know about you, but to me, it reads like a good deal.
My great advice is that if you want to decide on this program, do it before it is too late, if not, make room to see how others make money while you missed the opportunity.
Remember, currently, the Zcode System is 60% off, and it is not known how long it will be like this!
Until the squares are filled, or until there are very, very few left. Being you, I don't wait to find out. Take action today: VISIT ZCODE HERE

Amazon is going to dominate the next decade. It's a wonderful business trading at a discount to it's true ability to create cash earnings. My thesis is that traditional methods of valuation that work for most companies don't work for Amazon. This misunderstanding between market 'conservatives' or 'traditionalists' .. so called value oriented investors (of which I consider myself a part) is currently reflected in the share price today, and it's a mistake. Second, the firm has reached a point of inflection, where scale will now provide growth of earnings far in excess of growth in sales. This multiyear catalyst provides a fundamental basis for significant share price appreciation.
To understand why Amazon presents such a compelling investment opportunity, one must understand what is currently transpiring in two specific and unique business segments. E-commerce and Cloud Computing. Many of you are probably familiar with at least the former. The latter is foreign territory to most.
E-Commerce: Why Amazon is prepared to conquer the next decade in retail.
Traditional retail or brick and mortar (B&M from here on out) is still the dominant form of consumer spending in the U.S. and will be for some time. As of Q3 2019, total retail spend amounts to $5.4 Trillion dollar for the prior 12 months. E-commerce amounts to merely 11.2% of this amount (on a run rate basis.) While the size remains relatively small, e-commerce is growing in the mid-teens year over year, or now 5% quarter to quarter and the rate of growth is accelerating. The rate of E-commerce growth has doubled in 12 months.
To understand why this is the case, a qualitative evaluation of the differences between the two is critical. B&M requires physical space that is expensive to build and maintain. It requires uniformed, reliable, friendly and knowledgeable staff. It requires the deliberate presentation of inventory and restocking, amounting to a unique challenge to the retailer of determining layout of shelf space, product mix and promotion.
It's costly for the consumer too. They have to drive there, walk in, and find what they are looking for. This requires owning a car or putting up with public transportation. This can take a significant amount of time. There are some hidden costs too, without E-commerce, price discovery is a pain in the ass. Something retailers are keenly aware of. Here's something interesting about humans and economics. In economics, for a long time, we've modeled humans like they're these perfect rational beings. Ideally.. they'll drive down the road to a different store to get 3% off of whatever they're buying. Ideally. And you will do that for a car. But in reality, if it's 3% off a bag of chips, it's not worth the hassle. It's too expensive to go get $.14 of savings when you have to drive another 10 minutes to another grocery, walk in to figure it out if you're actually saving the most money.. consumers don't do that.
Consumers don't engage in price discovery on most of their small dollar purchases, they don't do that with traditional retail, because it's too costly in time and effort. There's too much friction in the trade-off.
The value proposition of E-commerce is that it saves consumers time and money. Getting in the car, loading the kids in the back, driving, parking, and then hunting for what you want, making sure you are getting a fair price, E-commerce throws all of that out the window. The value proposition for retailers too, is that it saves them time and money. There are plenty of retailers currently taking an omni-channel approach to retail, those who want to shop in person get to, those who shop online can do that too.. everybody wins.
Given the advent of mobile computing more than a decade ago, many big box retailers also adopted a price match strategy, if you can find it online for the same price? Best Buy, Micro Center etc. they'll match it to keep you as a customer. But that's the extent of it, try going to Kroger and arguing with the cashier about Albersons having a 3/$5 deal on Frito Lay Potato Chips.. that ain't happening.
Amazon isn't Ecommerce, they are a part of it. Their strategy is different than the whole. They are technically omni-channel. However the little B&M they've done mostly as R&D experiment, more on Whole Foods in a minute. The Amazon E-Commerce thesis is this: At the end of the day, most consumer purchases are commodity purchases. They are small dollar items that are easily replicated. This segment of retail has yet to be disrupted by E-Commerce until now. It overlaps with specialty retail and big box items almost seamlessly from a logistical standpoint. The revenue streams are more stable than specialty retail, and it presents a massive opportunity in the long run.
I had the chance to speak with a finance manager at Frito-Lay (subsidiary of PepsiCo) years back after Amazon bought Whole Foods. Amazon had been attempting for years to get the same products you see in any Kroger or Albertsons onto their platform. For a variety of reasons, PepsiCo would not play ball with Amazon. It amounted to channel conflicts between the big established players vs. the disruptive incumbent. What Pepsico had done to Amazon, had been done by Proctor and Gamble, Nestle, Kellogg, and many more.
The purchase of Whole Foods was a big F U, a "we'll do it live" moment.. a Leeroy Jenkins. So you won't let us into your club? Fine, we'll do it ourselves. Grocer's panicked and for good reason. They were the reason Amazon had been held at bay for so long. They'd used their absolute size for many years to prevent E-commerce retailers from getting the same product mix at the same price online. Amazon responded by entering their territory, in buying a physical grocery chain. Grocer's fear was real and warranted, however the truly brilliant component of this purchase was that Amazon purchased for themselves a supply chain for grocery and private label products (365 brand.) Fast forward a couple years and Amazon now has over four hundred private label brands, more than twenty three thousand individual SKUs and 1.4 Million reviews of these products/brands. That entire article is worth a thorough read. Each product line represents a moonshot where amazon can collect both sides of margin on a private label product that disrupts traditional brands. Often it goes well, sometimes it does not, but the platform allows them to poke holes in each product category, and cannibalize the producer surplus of other more expensive branded product in the process. They don't have to advertise, market or promote any of this either.. yet it's already getting plenty of attention. We normally don't do politics here on investmentDD, but imho if Elisabeth Warren is criticizing a company they must be doing something right.
Here is a compelling example of how Amazon can undercut a premium brand with it's store brand knock off. And there's nothing Allbirds can do about it.
Amazon has built out an infrastructure of warehouses (which are relatively cheaper to maintain on a $/sf basis than traditional B&M retail space) and delivery drivers to meet the daily needs of consumers accustomed to B&M retail. They've disinter-mediated the entire process. You do not need a car, you don't have to be nice to the person behind the counter, or go hunting for that specific product you need on aisle 9, or check to see if the price is competitive or on deal. You can just type it in to your phone in 5 seconds, and see quickly who has the best deal. Turns out (and this is from experience) 9/10 times Amazon has the best deal and they'll ship it that day or the next.
For the consumer, it amounts to savings in both time and money. What the data shows is that we are experiencing rapid change in slow motion. E-commerce is growing explosively here in the U.S. however it's still of relatively small scale, that it will take some time before eclipsing B&M retail. Second, the data shows this rate of growth is accelerating, and has doubled in the last year or so. Traditional retail is not going to disappear entirely either. There are plenty of Amazon proof businesses for now. Hair salons, vets, dentists, nail salons, along with restaurants and apparel to a certain extent.
This online E-commerce platform has allowed Amazon to build out a peripheral advertising business in search. The search component allows Amazon to promote it's own store brand product alongside the branded counterparts. Second, it's able to sell web page space to branded products. Google currently dominates the search game, but Amazon is in 2nd place and stealing market share.
Finally, Amazon has rolled out a wonderful product called Subscribe and Save. Within this platform, Amazon is able to offer 15%-20% savings on everyday commodity items in exchange for a commitment to purchase at a monthly frequency (and it can be cancelled at any time.) What Amazon has discovered is that subscription purchases are relatively sticky. In exchange for a soft commitment from consumers that is relatively stable and predictable, Amazon can actually lower the cost of goods to the consumer. In turn, they are also able to optimize logistically for these sales as they can plan far in advance for them. Second, this allows them to relay demand information to other merchants as well. Example: Amazon can remit data to Tide, and let them know how many pods they expect to need in the coming months based on subscription commitments. Both Tide and Amazon are able to lower CoGS because they have more time to plan for those costs.
Furthermore, if you have an Amazon Credit Card through Chase bank, you get an additional 3%-5% all purchase at Amazon & Whole Foods.
The combination of all of these benefits as a platform amounts is an incredibly compelling value proposition to consumers. As of June this year Amazon has accumulated 105 Million Prime Memberships in the United States, and it is the largest paid subscriber base of any company in the United States period.
One of the luxuries I enjoy in my occupation is that my employer has a very long investment time horizon & high risk tolerance. What this allows is for us to kick back, put our feet on the table and think about what the world will look like in 10 years and how we'd consider being a part of it.
So here's a thought experiment, what do you think the retail experience for consumers looks like in a decade? Here's my prediction. Consumer's buy the vast majority of the things they need online, and they receive it within a few hours to a day, and they're spending less than ever before on what they need. This is already happening, and It's grabbed the attention of people like Jim Cramer, as well as Fed Chairman Jerome Powell. Albeit, E-Commerce is relatively small for now, but the rapid transformation is already causing ripple effects across retail. In 10 years, my thesis is that E-commerce becomes the largest component of total retail sales and Amazon remains the largest component of that segment, as it is today. Additionally, they probably steal share and grow at a faster pace than E-commerce as a whole, as they have done over the last several years.
Personal anecdote:
I'm sitting here in my home office wearing Amazon branded Jeans. I've got 10+ Amazon branded undershirts upstairs, along with 5+ pairs of Amazon Synthetic Golf Shorts. In my house, we've got Amazon branded batteries, note cards & printer paper, detergent pods, echo devices, cameras and more all over the place. There's more too, but I'm not going to list it all. In my experience, what they make is just as good if not better than the branded counterpart, and they do it for less, often a lot less. And I got tired of hyperlinking, so if you're curious, go to amazon.com and start looking around for these products.
Even more, as of now my wife and I spend +$250/mo on subscribe and save items we need for our household, this includes baby formula, diapers and wipes, detergent, shampoo and soap, trash bags, dog food, paper towels and more. We use the 5% back credit card and blended save close to 20% on these daily items we need.
In conclusion, on E-Commerce, I expect Amazon to dominate the next decade in retail. They have a massive competitive advantage over other retailers engaged in an omni-channel strategy, therefore it's their game to lose. Furthermore, their competitive edge today will compound into the future and amount to further share gains and a wider moat in years to come.
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Cloud Computing: What is this industry, how does Amazon fit in the picture, and why is it such a big deal?
Again, to understand Amazon you'll have to understand what Cloud Computing is. This is not an everyday consumer product/service, therefore it's foreign to most individuals. Second, because the transactions and services are business to business (B2B) it's relatively difficult to determine detailed industry characteristics. What may come as a surprise to you, is it's the most profitable business segment (on a NOPAT basis) and it's also their fastest growing segment.
Cloud computing is the service of providing storage, services, databases, software, security, analytics, artificial intelligence and infrastructure through the internet. There was a time when most businesses built their own server racks, and maintained their own infrastructure. Amazon too did this for themselves in building out their own infrastructure to maintain their E-Commerce platform. In time, they naturally sold this service to other firms.
So where does Amazon fit in now? From all indications cloud computing appears to be an arms race. The most recent estimates for market share vary depending on the research provider. The differences lie in what is being measured. There are multiple components of Cloud: PaaS, IaaS, and SaaS. By all accounts, Amazon Web Services is the clear market leader, but they aren't growing as fast as some of their well funded peers like Microsoft and Google.
The available literature on Cloud Computing as a whole is vague. There are important questions to answer regarding structural advantage or lack thereof, who has the competitive edge, or what kind of moats have been built. Amazon's slowing growth rate in Cloud is concerning. Ramped spend in R&D + SG&A during the 2019 fiscal year is encouraging, and these investments will reduce erosion of market share.
While Cloud remains Amazon's most profitable business segment for now, by revenue it's just ~12.5% of sales. Admittedly I am troubled by the amount of information I cannot obtain without significantly paying out of pocket. Nevertheless, given the relative size of this business, I'm comfortable putting the pencil down on AWS for now, and watching the industry closely going forward.
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Other Business Segments:
Amazon has other business segments like their own B&M retail stores including Whole Foods, it's 4 star retail chain as well as it's cashierless Amazon Go stores. All of these combined are worth little compared to the market cap, while interesting.. they are insignificant in determining Amazon's value as a business.
What is Amazon worth today?
Herein lies the problem for analysts when the look at Amazon. The most commonly used methods for determining value are off the charts, for the most part Amazon looks like lighting money on fire.
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A simple value oriented investor looks at a trailing P/E of 84.19 and thinks why would I wait 84 years to get paid back?
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Of course, that's too myopic, and value oriented investors who take that approach, quickly learn trailing P/E is the key to building a portfolio of value traps. More sophisticated investors like Joel Greenblatt might recommend using something like ROIC to gauge how much Amazon benefits from reinvesting and building out it's own business.
The problem with that approach is that ROC, ROCE, and ROIC all use some form of GAAP earnings (either NOPAT or EBIT) to backsolve for this return number. If you look at Amazon's Income Statement, and dissect why net income is what it is there's a good reason why most value metrics/ratios don't work for Amazon. They are investing ~3x NOPAT and 60% of Gross profit into R&D. SG&A tells a similar story. What is R&D anyways? One time costs to develop and build out a business. What is SG&A, variable manpower with a significantly lagged ROI when ramped more than 20% YoY.
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What dawned on me months ago is this.. what if Amazon cut it's R&D to 0, and didn't touch SG&A? P/E TTM drops to ~20x. What happens to sales growth then? It slows.. and eventually converges with GDP, and then falls beyond that. The story of what Amazon's business is, especially E-Commerce, helps shed light on how long it'd take for Amazon's growth to converge with GDP, when they're on the cutting edge of the knife, and most other competitors remain far behind.
What do other institutions believe Amazon is worth?
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There are 45 Wallstreet Analysts covering the stock. On average, their price target is 2170. Based on the share price today, if they're right, you can expect a 15% return. What if the bears are right? You'll lose ~2% rounding down. And the bulls? the highest estimate is 2550, and represents a 35% premium on the stock.
Here's what Morningstar thinks:
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Keep in mind, the last price is a bit dated. Let's pretend Morningstar is right, I like them more than most analysts. You can expect a 22% return.
I don't like wall street analysts, if I did, I wouldn't do this, and I'd just follow their guidance. They are often right, but can be very wrong at times. The problem with wall street analysts is that they are subject to herding, as well as many other behavioral biases and sometimes conflicts of interest.
But assuming they're right, this is an asymmetric long to take, with significant upside today.
I have an estimate for fair value as well. This involves taking the current growth rate for amazon as well as the mean estimate of earnings two years out. However, instead of earnings, I like mean cash flow per share, because it remains undistorted by GAAP adjustments.
Here are the current cash flow per share estimates:
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Here is my valuation model:
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https://preview.redd.it/fx4o28ngl2a41.png?width=1694&format=png&auto=webp&s=d4f76fa5c1c539032d9b13f51f7ca41793fb4b34
Bottom left in yellow: that is the implied value of AMZN shares today, based on the discounted free cash flows.
Bottom middle with a red circle around it, those are my assumptions for long term growth rate and EPS 2 years out.. so TTM 2021 cash flows.
This would imply a 63% upside on the share price today.
Now, I don't think anyone is getting 63% today, for AMZN shares. Admittedly I'd be surprised if you got ~$3100 for AMZN shares in a year. Unfortunately.. this business will probably continue to be misunderstood like it has been for many years until they're done reinvesting a significant portion of their gross profit into building the infrastructure that expands their business. However, that cash flow number will become remarkably close to EPS with R&D turned off. When it does, share price will rocket. Instead of this becoming a one time event, I expect convergence will be gradual over time, which makes it a long term hold.
More on valuation:
I was disappointed but not surprised to find I'm not the only one thinking about valuation in this way. The authors take is similar to mine, and he comes to a similar conclusion as well: ~20x P/E TTM. I've gone through everything the VIC has to say about AMZN and most everything should be available to you as non-members as it is dated. I found message 109 especially compelling:
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In Conclusion: I recommend Amazon stock as a long term investment. I believe this is one of the best value propositions available in this market. Regardless of the broader stock market, the secular trends within retail are significant tailwinds to Amazons largest business segment.
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Disclaimer: This document is entirely my own work, outside of linked/pictured information above which has been cited. I own a significant amount of AMZN stock personally. I am not responsible for your gains or losses. I may add more information to this document in the future.
Furthermore, feel free to share this write up as you see fit. Please don't share this on Wall Street Bets.
Addendum (1/14/20): The most significant risk to this business is political. The election of either Warren or Sanders in November of this year would most certainly affect valuation for this business in the near term. Whether Amazon is actually harmed by political interference is another story. For now, it appears the odds that either of these candidates receives the nomination is significantly below 50%, furthermore, as of now it appears they would be significantly disadvantaged against the orange man. Consider this tail risk.