AMZN Shares Jump 18 Percent On Second Quarter Profit

Amazon Inc. (NASDAQ: AMZN) reported its second quarter 2015 financial results this evening after the market close. The online retailer reported earnings per AMZN share of $0.19. Going into the report, the consensus of the 36 analysts who follow AMZN was for a loss of $0.14.

Amazon also reported gross revenues of $23.19 billion, up 19.9 percent from second quarter 2014 levels. Analysts had been forecasting revenues of $22.39 billion.

The AMZN EPS number caught the market off-guard in NASDAQ after-hours trading — AMZN shares soared 17.7 percent to $567.48 on heavy trading volume as of 6:45 p.m.

The $0.19 AMZN EPS number is a result of profits totaling $92 million. In the second quarter of 2014, AMZN reported a per share loss of $0.27, or $126 million. The results have clearly surprised market participants, as demonstrated by the sharp after-hours AMZN rally.

Amazon management offered third quarter guidance ranging from a loss of $480 million to $80 million in profits.

AMZN Shares At All-Time High

Before this evening’s earnings announcement, AMZN shares were already right at all-time high levels, extended about 10 percent above their most recent consolidation that ranged between $420 and $450. This evening’s move brings the AMZN shares close to 25 percent above the consolidation’s high. AMZN shares are up 82 percent in 2015.

Thirty-six research firms had been providing prices targets for AMZN shares: their average was $498.42. Targets ranged from $400 to $600. Revisions to AMZN price targets are likely.

Remarkable Growth For $255 Billion Company

Tonight’s after-hours trading in AMZN shares added about $32 billion to Amazon market capitalization. Analysts had been calling for full-year 2015 sales of $103.34 billion, up 16.1 percent from 2014 and full-year 2016 sales of $122.24 billion, which would represent growth of 18.3 percent if 2015 estimates are met.

Forecasts for AMZN EPS growth were calling for 35.8 percent in the third quarter and 194.2 percent for the full 2015 year. AMZN EPS growth is seen at 485.7 percent in 2016 and averaging 35.5 percent annually over the coming five years. Revisions to both sales and EPS estimates are also likely.

Amazon’s financial results demonstrate a remarkable ability on the part of management to grow both profits and sales, something that is infinitely more challenging for a company with $100 billion in sales than for smaller competitors.

AMZN EPS forecasts have even topped those for a much younger company that should be growing more quickly: Facebook, Inc. (NASDAQ: FB). Current FB EPS estimates are calling for growth of 16.3 percent next quarter and 13.6 percent for 2015. FB EPS is expected to grow 32.3 percent in 2016 and average 28.4 percent over the next five years.

With AMZN EPS growth forecast to surpass even that of Facebook, and with forecasts likely to change further, trading is sure to be brisk in AMZN shares tomorrow.

[CEO Photo by David McNew / Getty Images – Conveyer Photo by Sean Gallup / Getty Images]