Amazon.com, Inc. (AMZN): Our Calculation of Intrinsic Value

Core Insights - Amazon.com, Inc. is a leading global technology and retail platform, excelling in e-commerce, cloud computing, and digital advertising, while also venturing into AI infrastructure and subscription services [2][3] Financial Performance - Amazon generated over $670 billion in annual revenue, with a cash balance exceeding $100 billion and improving free cash flow, indicating strong financial health and a competitive advantage across various industries [3] DCF Analysis - The DCF model indicates a total present value of forecasted free cash flows of $164.1 billion, with a terminal value of $957.1 billion, leading to an enterprise value of $786.6 billion [4] - After accounting for net debt of $29.7 billion, the equity value is calculated at $756.9 billion, resulting in an intrinsic value per share of approximately $71 [5] Market Valuation - The current market price of Amazon shares is around $249, suggesting a margin of safety of -72%, indicating that the stock is trading significantly above its intrinsic value [5] - Despite Amazon's strong market position and growth potential, the high market valuation reflects expectations of robust growth and profitability in the coming decade [5]