Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Amazon.com AMZN in comparison to its major competitors within the Broadline Retail industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of 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 | 43.19 | 8.85 | 4.01 | 6.19% | $32.08 | $31.0 | 11.04% |
| Alibaba Group Holding Ltd | 20.49 | 1.80 | 1.86 | 4.64% | $54.02 | $92.47 | 5.21% |
| PDD Holdings Inc | 11.01 | 4.04 | 3.20 | 9.38% | $29.18 | $59.65 | 44.33% |
| MercadoLibre Inc | 71.40 | 25.50 | 5.58 | 10.37% | $0.72 | $2.44 | 35.27% |
| JD.com Inc | 12.76 | 1.82 | 0.40 | 5.22% | $15.92 | $45.04 | 5.12% |
| Coupang Inc | 41.94 | 10.25 | 1.48 | 1.74% | $0.28 | $2.27 | 27.2% |
| eBay Inc | 17 | 5.97 | 3.36 | 11.59% | $0.95 | $1.85 | 3.04% |
| Vipshop Holdings Ltd | 7.20 | 1.49 | 0.54 | 2.76% | $1.47 | $4.96 | -9.18% |
| Dillard's Inc | 12.18 | 3.83 | 1.14 | 6.37% | $0.21 | $0.63 | -3.53% |
| MINISO Group Holding Ltd | 22.84 | 5.39 | 3.73 | 6.68% | $0.88 | $2.03 | 19.29% |
| Ollie's Bargain Outlet Holdings Inc | 32.11 | 4.09 | 2.96 | 2.24% | $0.06 | $0.21 | 7.79% |
| Macy's Inc | 23.93 | 0.98 | 0.18 | 0.66% | $0.29 | $2.04 | -2.68% |
| Nordstrom Inc | 15.40 | 4.07 | 0.27 | 4.75% | $0.3 | $1.31 | 4.34% |
| Savers Value Village Inc | 24.13 | 4.10 | 1.22 | 5.09% | $0.07 | $0.22 | 0.53% |
| Kohl's Corp | 5.75 | 0.37 | 0.08 | 0.58% | $0.28 | $1.57 | -8.49% |
| Groupon Inc | 17.03 | 11.68 | 0.87 | 34.72% | $0.03 | $0.1 | -9.48% |
| Hour Loop Inc | 46.40 | 12.19 | 0.57 | 7.3% | $0.0 | $0.02 | 6.6% |
| Average | 23.85 | 6.1 | 1.72 | 7.13% | $6.54 | $13.55 | 7.83% |
After thoroughly examining Amazon.com, the following trends can be inferred:
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Notably, the current Price to Earnings ratio for this stock, 43.19, is 1.81x above the industry norm, reflecting a higher valuation relative to the industry.
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With a Price to Book ratio of 8.85, which is 1.45x the industry average, Amazon.com might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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With a relatively high Price to Sales ratio of 4.01, which is 2.33x the industry average, the stock might be considered overvalued based on sales performance.
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The company has a lower Return on Equity (ROE) of 6.19%, which is 0.94% below the industry average. This indicates potential inefficiency in utilizing equity to generate profits, which could be attributed to various factors.
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The company exhibits higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $32.08 Billion, which is 4.91x above the industry average, implying stronger profitability and robust cash flow generation.
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Compared to its industry, the company has higher gross profit of $31.0 Billion, which indicates 2.29x above the industry average, indicating stronger profitability and higher earnings from its core operations.
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The company is experiencing remarkable revenue growth, with a rate of 11.04%, outperforming the industry average of 7.83%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.
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.
By analyzing Amazon.com in relation to its top 4 peers based on the Debt-to-Equity ratio, the following insights can be derived:
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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 0.52, 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, PB, and PS ratios are all high compared to its peers in the Broadline Retail industry, indicating that the stock may be overvalued. The low ROE suggests that Amazon.com is not generating significant returns on shareholder equity. However, the high EBITDA, gross profit, and revenue growth show that the company is performing well in terms of operational efficiency and revenue generation compared to its industry peers.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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