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An employee prepares a package for shipment at the Amazon logistics center in Suelzetal near Magdeburg, eastern Germany.

Ronny Hartmann / AFP via Getty Images

Stock in e-commerce behemoth

Amazon.com

is dropping after beating Wall Street earnings projections. Stop us if you have heard that before. A beat and drop is the typical outcome for Amazon shares.

Yes, investors always have reasons to get nervous, and this time the reason isn’t the earnings themselves. Amazon.com (ticker: AMZN) reported $15.12 in unadjusted per-share earnings. Wall Street was looking for $12.28 a share. Instead, the company forecasts a slowdown in online sales for the coming quarter.

The stock is down 6.8% at 10:11 a.m. Friday. Amazon is probably the reason the

S&P 500

and

Dow Jones Industrial Average

are down 0.2% and 0.0.2%, respectively. Amazon sucked the wind out of the market.

If shares finish down Friday—and it looks very likely they will—it will be the ninth earnings beat during the past 12 quarters, and the sixth time it has dropped following a beat. In other words, there’s a 67% chance that Amazon stock drops no matter how good the earnings are.

Investors focused on the third quarter, however, might be missing the point. What investors should remember is at the start of this series—the third quarter of 2018—Amazon stock was trading at about $1,782 a share. It closed Thursday at almost $3,600 a share. That works out to an annual average return of roughly 29%. Not bad.

Quarterly reports are funny things. More often than not they confirm what investors already know. Take

Caterpillar

(CAT). Cat and Amazon have little in common except they both reported between the close of trading Thursday and the opening of trading on Friday. Cat’s quarter shows strong demand as the economy recovers and pressure from rising commodity costs. Not a shocker. And yes its stock is down 2.4%.

Quarterly reports rarely change an investment thesis. Yes, sometimes true bombshells get dropped. For Amazon, it isn’t likely that online sales slowing coming out of the pandemic qualifies as the bombshell Friday trading seems to indicate though.

That’s our hunch.

Write to allen.root@dowjones.com

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