Amazon stock downgraded due to ebook rivalry

The Wall Street Journal is reporting:

Despite its early lead in the fast-growing e-book market, Inc. (AMZN) faces growing competition from tech giants Google Inc. (GOOG) and Apple Inc. (AAPL), according to one analyst.

Marianne Wolk of Susquehanna downgraded Amazon to a neutral rating on Monday. In a note to clients, the analyst cited "intensifying competition" in the e-book market, which is creating more uncertainty around the company's Kindle business.

I was all set to point out the flaws in her argument, only I can't. TBH, I thought she was like that publicity whore I posted about last week. She's not.

You can identify a publicity whore by how over the top their future predictions are.  For example, last week some idiot said that Apple was going to defeat Amazon in the ebook market. He had no real evidence for this statement, which is why it was over the top.

Marianne Wolk, on the other hand, didn't make future predictions. Instead, she made statements about the way the market is now.While I may not agree with her, everything she said was reasonable.

"With moves pending by Apple and Google, rising competition is raising the uncertainty regarding eReader, eBook, and Book profit growth rates, capping the contribution to Amazon's valuation from these sectors," Wolk wrote.

"Thus, we are less confident in the multiple expansion we previously forecast," she added.

Okay, Google is closer to being a rumor, but there's a lot of weight behind it.

About Nate Hoffelder (11468 Articles)
Nate Hoffelder is the founder and editor of The Digital Reader: "I've been into reading ebooks since forever, but I only got my first ereader in July 2007. Everything quickly spiraled out of control from there. Before I started this blog in January 2010 I covered ebooks, ebook readers, and digital publishing for about 2 years as a part of MobileRead Forums. It's a great community, and being a member is a joy. But I thought I could make something out of how I covered the news for MobileRead, so I started this blog."

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