In the fast-paced and highly competitive business world of today, conducting thorough company analysis is essential for investors and industry observers. In this article, we will conduct an extensive industry comparison, evaluating Amazon.com (NASDAQ: AMZN) in relation to its major competitors in the Broadline Retail industry. Through a detailed examination of key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and illuminate company's performance in 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 | 33.50 | 7.02 | 3.53 | 5.68% | $36.6 | $86.89 | 13.33% |
| Alibaba Group Holding Ltd | 19.88 | 2.88 | 2.94 | 4.26% | $53.52 | $111.22 | 1.82% |
| PDD Holdings Inc | 14.02 | 3.64 | 3.35 | 8.89% | $25.79 | $58.13 | 7.14% |
| MercadoLibre Inc | 60.96 | 21.90 | 5.19 | 9.76% | $0.95 | $3.09 | 33.85% |
| Sea Ltd | 95.14 | 11.29 | 5.93 | 4.36% | $0.58 | $2.41 | 38.16% |
| Coupang Inc | 160.95 | 12.53 | 1.85 | 0.71% | $0.34 | $2.56 | 16.4% |
| JD.com Inc | 9.64 | 1.54 | 0.29 | 2.68% | $7.34 | $56.64 | 22.4% |
| eBay Inc | 20.25 | 8.77 | 4.19 | 7.59% | $0.65 | $1.95 | 6.14% |
| Dillard's Inc | 17.22 | 5.07 | 1.50 | 3.86% | $0.14 | $0.58 | 1.41% |
| Vipshop Holdings Ltd | 9.87 | 1.64 | 0.65 | 3.74% | $1.91 | $6.05 | -3.98% |
| Ollie's Bargain Outlet Holdings Inc | 38.38 | 4.55 | 3.35 | 3.49% | $0.09 | $0.27 | 17.49% |
| MINISO Group Holding Ltd | 21 | 4.47 | 2.64 | 4.56% | $0.73 | $2.2 | 23.07% |
| Macy's Inc | 10.23 | 1.09 | 0.22 | 1.95% | $0.36 | $2.1 | -1.9% |
| Savers Value Village Inc | 68.55 | 5.04 | 1.42 | 4.52% | $0.06 | $0.23 | 7.9% |
| Kohl's Corp | 8.73 | 0.46 | 0.11 | 3.97% | $0.45 | $1.53 | -4.98% |
| Hour Loop Inc | 102 | 15.03 | 0.78 | 18.14% | $0.0 | $0.02 | -3.45% |
| Average | 43.79 | 6.66 | 2.29 | 5.5% | $6.19 | $16.6 | 10.76% |
By thoroughly analyzing Amazon.com, we can discern the following trends:
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At 33.5, the stock's Price to Earnings ratio is 0.77x less than the industry average, suggesting favorable growth potential.
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The elevated Price to Book ratio of 7.02 relative to the industry average by 1.05x suggests company might be overvalued based on its book value.
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With a relatively high Price to Sales ratio of 3.53, which is 1.54x the industry average, the stock might be considered overvalued based on sales performance.
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The company has a higher Return on Equity (ROE) of 5.68%, which is 0.18% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $36.6 Billion is 5.91x above the industry average, highlighting stronger profitability and robust cash flow generation.
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With higher gross profit of $86.89 Billion, which indicates 5.23x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.
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The company's revenue growth of 13.33% is notably higher compared to the industry average of 10.76%, showcasing exceptional sales performance and strong demand for its products or services.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio helps evaluate the capital structure and financial leverage of a company.
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.
In terms of the Debt-to-Equity ratio, Amazon.com stands in comparison with its top 4 peers, leading to the following comparisons:
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Amazon.com demonstrates a stronger financial position compared to its top 4 peers in the sector.
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With a lower debt-to-equity ratio of 0.4, the company relies less on debt financing and maintains a healthier balance between debt and equity, which can be viewed positively by investors.
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. In terms of ROE, EBITDA, gross profit, and revenue growth, Amazon.com outperforms 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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