Amazon Sinks on Analyst Comments

Amazon.com (Nasdaq: AMZN) fell 1 1/16 to 22 11/16 Thursday after Prudential Securities issued a research note saying the e-tailer was running out of some items.

"Our return trip to four online toy stores in mid-December revealed slim pickings for shoppers," Prudential said. "We found a greater out-of-stock position at Toysrus.com/Amazon.com than at other online toy retailers."

Prudential maintains a hold rating on Amazon.

Meanwhile, CE Unterberg Towbin said it lowered its 12-month price target for Amazon shares to 35 from 50, representing "present market realities regarding e-tailer valuations." At the same time, the firm repeated a buy rating on Amazon.

"Though AMZN may have a significant move during 2001, we do not believe this will occur until the latter part of the year, if and when the company finally demonstrates an ability to operate profitably," the firm said.

So far this year, Amazon appears to be holding on to its e-tail lead. The site attracted more visitors than any other during the first four weeks of the holiday shopping season, according to Nielsen//NetRatings.

The company is also the number one Net advertiser, according to a report released Thursday by AdRelevance, a Jupiter Media Metrix company.

With more than 500 million ad impressions on Web sites each week since October, Amazon has ranked as the top online advertiser for eight of the past nine weeks.

"If [its] recent online ad campaigns pay off, Amazon will be well on its way to achieving single-company e-tail dominance -- and their current strategies will serve as the standard for how to win big in the online world," said Charles Buchwalter, vice president of media research at New York City-based AdRelevance.