Friday, April 2, 2021

Amazon

Jeff Bezos, CEO of Amazon, earns a salary of $80,000 per year but since Amazon pays no dividends the company pays for most of his expenses including $1.2 million per year for personal protection. The company from the onset has always reinvested its profits instead of paying dividends to stock holders. The reason to buy Amazon stock is for growth not dividends. For years Amazon lost money and uses those past loses to offset current profits. In addition the company reinvest much of its profits as it has always done to promote growth. They also pay stock options and all of these things combine to minimize the tax they pay. This is unlike the Walmart family members who do not work for the company, except a couple who are on the board, who rely on dividends. They live modest lives spending a lot of time on non-work related activities. Their income comes from the 1.4 billion shares of Walmart stock that the family owns. The dividend is $2.20 so the family gets $3 billion per year from dividends. If they gave their dividends to the 2.2 million employees each would receive $1,300.

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