Maybe cause they don't have any sustainable Revenue to justify their UNGODLY stock price? And, now need to compensate.
Let's not forget Microsoft was at $65 the majority lf their life.
Let's not forget Microsoft was at $65 the majority lf their life.
They'll have near ~$30 billion in profit within the next four to five years, which will bring their PE down to a high, but not ungodly, 30x.
AWS is worth $300-$350 billion now. Very soon it will soon be larger than Oracle and it's growing extremely fast for a large business (a high multiple would be granted). Their ad business is worth $100-$150 billion. In the next four to five years, those two businesses together will be worth as much as the entire company is today. That's a big part of what investors are betting on, along with the expectation that Amazon is going to continue to find new profit centers.
Sure, you might say, why is Amazon priced for earnings four or five years out? Well, that's the standard practice of pulling future returns forward. Almost always happens with growth companies, inevitably leads to a stagnation period. Amazon will continue to grow into their market cap and their annual returns will drift downward.