Every time I see a story about Amazon.com, Inc. (NASDAQ: AMZN) I am infuriated and bewildered. How in the world can a 13 year old company have a P/E ratio of 70 and $32 billion capitalization on 37% year over year growth. The top line growth is great and so is the growth in net earnings but does it justify a P/E of 70?

Yesterday Amazon impressed Wall Street by beating expectations in many areas. However, two areas that disappointed were it's reduced earnings projections for the year and a lack of transparency or specifics in certain segments of its enterprise. Also if earnings were lowered by 4% to 6% then why is the stock only down 3%?

The stock is down about $2 from yesterday's close of $81 fluctuating in the the high 70's. From my perspective the stock is way too high and the limited number of shareholders is still holding up the price. Last year I wrote Who owns Amazon.com - really? and not much has changed in this regard.

When I look at Amazon's metrics I see some very good things and some that are highly suspect. You have to love the ROE of almost 58% and the ROIC just under 25%, but how can one support a price-to-book (no pun intended) of 32?

The company has growing cash-flow, something that is very important to every investor, but its P/CF is a multiple of 60! This seems scary. Some have argued that it is still early in the game. Okay, I'll give them one better; let's say it's game -- set -- match in Amazon's favor. They have been at this game a long time already.

Before anyone rants about why I hate Amazon.com, let me stop you by stating clearly that I love Amazon and the service they provide, and I am a long time customer. It's just that I do not think the stock is fairly priced. I like milk too, but I would think twice before paying $20 a bottle (at least today). For all the joy about the company and its potential, I am starving for information from anyone that can explain the valuation.

It is not enough to say that I just don't get it. Obviously that is the case, but who can make the specific case about why it is worth $75 to $80 a share instead of half that? I still need convincing. Amazon has only reported any significant profits in recent quarters and that is in the 3% to 4% range. That does not seem very high for the category killer on the Internet.

Update: closing stock price $77.69 down $3.31..so it did go down in line with the projected earnings short fall ;-)

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I hold no position in AMZN.