亚马逊 Amazon

SG&A/Sales is 9.7% in terminal period
25.1% 21.6% 18.7% 16.7% 14.7% 13.7% 12.7% 11.7% 10.7% 9.7% 9.7%
SG&A/Sales

EBITDA margin improves from -8% to 14%

Restate financials in 2000 by moving 84460 of depreciation out of SG&A and into depreciation. Makes EBITDA really before DA!
Income Statement Assumptions Sales Revenue Growth Rate


cuddle up with a DCF model critically evaluate a valuation model


what is the analyst assuming about profitability, efficiency and leverage? are the pieces put together in a logical way?


consider the option value of owning a share of AMZN how to adjust the value estimate for employee ห้องสมุดไป่ตู้tock options

NET SALES 3000000 2500000 2000000 1500000 1000000 500000 0 -500000 -1000000 -1500000 -2000000 1995 1996 1997 1998 1999 2000 NET INCOME


implies that the useful life of fixed assets is between 4 years and 8 years.

hold constant
non-operating income, interest and taxes

Income Statement Assumptions
balance sheet assumptions working capital

what does analyst model assume? adjusted Other Current Liabilities to hit WC assumptions (shown on FCF computations on Cash Analysis sheet)
Why is the default valuation of AMZN negative?

ROE is HUGE positive amount. Why?

Why can’t the stock price be negative?
Hitting the analyst forecasts clean up the financial statements


Set non-operating income to –12% in 2001 to write off Investments, Intangibles and Other Assets (total is $407624) set interest rate to 7.75% to value debt approximately at its book value enter tax rates as given (although taxes are not, generally, expressed as a % of EBITDA, as in analyst report)

EBITDA = “earnings before interest, taxes, depreciation and amortization”
= gross margin – R&D – SG&A

keep CGS/Sales at constant 76.3% and adjust SG&A/Sales to hit EBITDA margins
balance sheet assumptions cash

what does the analyst report assume about cash? set operating cash to 0% for all future periods


what is the valuation implication of doing this?
Per analyst model, 24% in 2001, constant at 25% through 2010, and terminal growth rate (beyond 2010) of 7%.
…Is this reasonable?
Income Statement Assumptions EBITDA margin
17.1% 15.2% 13.6% 12.0% 10.6% 9.2% 8.0% 6.5% 5.2% 5.2%
Ending Other Current Liabs/Sales 15.7%

in 2001 decrease in WC is 1220837 (=1100522 cash liquidation plus 120315 WC reduction in analyst report) WC turnover ratio goes from +8 to -8.
Income Statement Assumptions Depreciation and Amortization
(just a stop on the way to CapX)

goodwill and intangibles written off in 2001 2000 depreciation ratio = 84460/(317613+366416)/2 = 25%