Sign in Subscribe
Internet services

Amazon.com Shares Plunge on Analyst Remarks and Earnings Report

Strategic Insights

— 2 min read

Amazon.com Inc.'s stock price fell nearly 20% on Friday after a report from Lehman Brothers expressed concerns about the company's financial health and net sales. The report, combined with negative comments from influential Internet stock analyst Mary Meeker, sent the company's shares plummeting. Amazon's stock price dropped to $33.875, a significant decline from its 52-week high of $113 in December, bringing the total decline to over 70%. The acquisition by Mpower Communications Corp. of Primary Network Holdings for $149.5 million, the launch of Excel Group's Internet trading site for China-U.S. trade, and Solutia Inc.'s decision to sell its polymer modifiers business to Ferro Corp. filled out the day's business news.

Key Takeaways:

  • Amazon.com Inc.'s stock price plunged nearly 20% on Friday due to a report from Lehman Brothers warning about the company's financial health.
  • The report, combined with negative comments from Mary Meeker, a well-known Internet stock analyst, contributed to the decline.
  • The stock price dropped to $33.875, a significant decline from its 52-week high of $113 in December, resulting in more than 70% loss.
  • Amazon's financial health and net sales remain a concern for investors, as the company continues to operate at a loss.
  • The acquisition of Primary Network Holdings by Mpower Communications Corp. for $149.5 million added to the day's business news.
  • Excel Group launched an Internet trading site, www.chinatradingtime.com, to facilitate trade between China and the U.S. businesses.
  • Solutia Inc. agreed to sell its polymer modifiers business and manufacturing facilities to Ferro Corp. of Cleveland.
  • The deal, worth $149.5 million, involves the transfer of over 200 Solutia Inc. employees to Ferro Corp.
  • Primary's founder, Brian Matthews, will leave the company after the acquisition, while John Alden, a senior vice president, will continue to oversee sales.

Statistics:

  • Amazon.com Inc.'s stock price dropped $8.125 on Friday, reaching $33.875.
  • The company's stock price is down over 70% from its 52-week high of $113 in December.
  • Mpower Communications Corp. acquired Primary Network Holdings for $149.5 million.
  • The acquisition involves Mpower issuing 1.4 million shares of its own stock to Primary investors.
  • The total value of the shares issued to Primary investors is $73.5 million.
  • Solutia Inc. is assuming $76 million of Primary's debt as part of the acquisition.

Sources:

  • "Amazon.com shares plunge on analyst remarks" - Unspecified publication date.
  • Lehman Brothers report, as cited in the article.
  • Mpower Communications Corp. press release, as cited in the article.
  • Excel Group press release, as cited in the article.
  • Solutia Inc. press release, as cited in the article.

Read more