Second-quarter results: earnings tripled, revenue was strong and profit margins actually expanded. For years, Wall Street complained that Amazon was myopically focused on sales at the expense of
profit, as Amazon turned its attention to technology and content.
Now that Amazon has gone "two for two" in 2007, as Jackson Securities analyst Brian Bolan wrote in a research note on Wednesday, Wall Street is wondering how long the party can last. Some analysts raised their earnings estimates and price targets for the stock, while others said Amazon had exhausted its mileage from recent growth, which now has the company's valuation pegged to 50 times estimated 2008 earnings--well above rival eBay, whose core business continues to struggle for growth. Its stock trades at 21 times estimated '08 earnings.