Alec Hogg: Three reasons to consider selling Amazon

Feels like sacrilege to even consider it. But as we draw closer to the monthly BizNews portfolio update webinar on Feb 23 (register here), I'm wondering whether it's time to lighten our Amazon stake. Our holding period is "forever", except when the business's fundamentals change. Amazon's appear to have.

Also read: Alec Hogg: SA opportunity in US min wage doubling

First of the three major reasons informing my thinking is valuation. When Amazon was added to the portfolio in December 2014, the shares traded at $328, valuing the group at $145bn. Today the same shares cost over $3 300, translating into a market capitalisation of $1.7trn. Put differently, in 2014 Amazon was worth 1.6 times its annual sales; today the multiple is 4.4 times.

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