In today's fast-paced and competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies before making investment decisions. In this article, we will conduct a comprehensive industry comparison, evaluating Amazon.com AMZN against its key competitors in the Broadline Retail industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.
Amazon.com Background
Amazon is the leading online retailer and marketplace for third party sellers. Retail related revenue represents approximately 75% of total, followed by Amazon Web Services' cloud computing, storage, database, and other offerings (15%), advertising services (5% to 10%), and other the remainder. International segments constitute 25% to 30% of Amazon's non-AWS sales, led by Germany, the United Kingdom, and Japan.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Amazon.com Inc | 30.35 | 6.47 | 3.08 | 5.79% | $36.48 | $78.69 | 8.62% |
| Alibaba Group Holding Ltd | 18.47 | 2.19 | 2.29 | 5.01% | $59.0 | $117.63 | 7.61% |
| PDD Holdings Inc | 10.61 | 3.65 | 3.03 | 9.28% | $32.41 | $62.81 | 24.45% |
| MercadoLibre Inc | 59.61 | 26.18 | 5.48 | 15.3% | $0.96 | $2.75 | 37.42% |
| JD.com Inc | 9.22 | 1.50 | 0.33 | 4.21% | $12.54 | $53.12 | 13.37% |
| Coupang Inc | 299.88 | 10.61 | 1.45 | 3.76% | $0.44 | $2.49 | 21.4% |
| eBay Inc | 16.90 | 6.55 | 3.34 | 9.95% | $0.77 | $1.86 | 1.13% |
| Vipshop Holdings Ltd | 7.22 | 1.34 | 0.52 | 6.31% | $3.29 | $7.63 | -4.18% |
| Ollie's Bargain Outlet Holdings Inc | 34.35 | 4.02 | 3.02 | 4.14% | $0.1 | $0.27 | 2.79% |
| MINISO Group Holding Ltd | 16.04 | 4.01 | 2.47 | 8.12% | $0.99 | $2.22 | 22.68% |
| Dillard's Inc | 9.60 | 3.09 | 0.86 | 11.4% | $0.31 | $0.74 | -4.97% |
| Nordstrom Inc | 13.87 | 3.54 | 0.27 | 15.61% | $0.44 | $1.69 | -2.17% |
| Macy's Inc | 5.72 | 0.72 | 0.14 | 7.86% | $0.68 | $3.02 | -4.39% |
| Savers Value Village Inc | 76.79 | 4.09 | 1.15 | -1.13% | $0.03 | $0.2 | 4.51% |
| Kohl's Corp | 7.20 | 0.21 | 0.05 | 1.26% | $0.31 | $1.92 | -9.39% |
| Hour Loop Inc | 61 | 8.31 | 0.31 | -25.78% | $-0.0 | $0.02 | -8.51% |
| Average | 43.1 | 5.33 | 1.65 | 5.02% | $7.48 | $17.22 | 6.78% |
By conducting an in-depth analysis of Amazon.com, we can identify the following trends:
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At 30.35, the stock's Price to Earnings ratio is 0.7x less than the industry average, suggesting favorable growth potential.
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It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 6.47 which exceeds the industry average by 1.21x.
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The stock's relatively high Price to Sales ratio of 3.08, surpassing the industry average by 1.87x, may indicate an aspect of overvaluation in terms of sales performance.
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With a Return on Equity (ROE) of 5.79% that is 0.77% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $36.48 Billion, which is 4.88x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
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With higher gross profit of $78.69 Billion, which indicates 4.57x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.
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With a revenue growth of 8.62%, which surpasses the industry average of 6.78%, the company is demonstrating robust sales expansion and gaining market share.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
When evaluating Amazon.com alongside its top 4 peers in terms of the Debt-to-Equity ratio, the following insights arise:
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When comparing the debt-to-equity ratio, Amazon.com is in a stronger financial position compared to its top 4 peers.
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The company has a lower level of debt relative to its equity, indicating a more favorable balance between the two with a lower debt-to-equity ratio of 0.44.
Key Takeaways
For Amazon.com, the PE ratio is low compared to its peers in the Broadline Retail industry, indicating potential undervaluation. The high PB and PS ratios suggest that the market values Amazon.com's assets and sales highly. Amazon.com's high ROE, EBITDA, gross profit, and revenue growth outperform its industry peers, reflecting strong financial performance and growth potential.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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