AmTech Reiterates Sell on Amazon (AMZN); Cuts PT to $45

October 10, 2008 2:09 PM EDT

American Technology Research reiterates its Sell rating on Amazon (Nasdaq: AMZN) and lowers its price target from $60 to $45.

The firm calls a Q4 guide-down at Amazon "a virtual certainty" unless organic demand has improved during Q3. AmTech believes Amazon will have to lower its Q4 and FY08 outlook when it reports its earnings on Wednesday, October 22, given an 11% rally in the US dollar index over the quarter.

AmTech points out that since the majority of Amazon's expenses come from within the US, its international segment provides significantly higher operating margins than the North American segment, so as the US dollar appreciates, the online retailer not only losses revenues, but losses much higher-margin sales.

Interestingly, AmTech believes Amazon is the only remaining "cult tech stock" that has yet to fall out of the bed. The firm provides evidence for this claim by noting that while Amazon is off its 52-week by 40%, other top large-cap stocks such as Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG) and Research In Motion (Nasdaq: RIMM) are down 56%, 56%, and 60%, respectively, from their high's.

Amazon.com, Inc. operates retail Web sites, as well as provides programs that enable third parties to sell their products on its Web sites in North America and internationally.

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