On May 17, we recommended buying puts on Amazon (AMZN).  Since that time, the stock has traded up about 9% and the July $60 puts have gobe from $2.35 to around $1.15.

** Full disclosue - I purchased the July $60 puts at $1.70 on May 21.

Nothing has changed fundamentally with the story on Amazon, so we now STRONGLY reiterate buying the July $60 puts.  TheStreet.com has a good piece on the recent surge in valuation: Amazon Ripping the Shorts

Here’s further evidence that shares of AMZN are insanely valued at current levels, particularly when compared to other a basket of comparable growth stocks - Google (GOOG), Apple (AAPL), eBay (EBAY) and Starbucks (SBUX).  You’ll see that AMZN’s valuation relative to its growth rate (PE/Growth, or PEG Ratio) is more than double that of the basket of comparables.  Amazon should be trading in the mid-$30s.