In today's rapidly changing and highly competitive business world, it is vital for investors and industry enthusiasts to carefully assess companies. In this article, we will perform a comprehensive industry comparison, evaluating Amazon.com AMZN against its key competitors in the Broadline Retail industry. By analyzing important 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 | 47.72 | 9.06 | 3.85 | 6.19% | $32.08 | $31.0 | 11.04% |
| Alibaba Group Holding Ltd | 17.17 | 1.51 | 1.56 | 4.64% | $54.02 | $92.47 | 5.21% |
| PDD Holdings Inc | 10.04 | 3.68 | 2.92 | 9.38% | $29.18 | $59.65 | 44.33% |
| MercadoLibre Inc | 65.21 | 23.29 | 5.10 | 10.37% | $0.72 | $2.44 | 35.27% |
| JD.com Inc | 11.52 | 1.64 | 0.36 | 5.22% | $15.92 | $45.04 | 5.12% |
| Coupang Inc | 39.27 | 9.59 | 1.39 | 1.74% | $0.28 | $2.27 | 27.2% |
| eBay Inc | 16.40 | 5.75 | 3.24 | 11.59% | $0.95 | $1.85 | 3.04% |
| Dillard's Inc | 11.68 | 3.67 | 1.10 | 6.37% | $0.21 | $0.63 | -3.53% |
| Vipshop Holdings Ltd | 6.40 | 1.33 | 0.48 | 2.76% | $1.47 | $4.96 | -9.18% |
| MINISO Group Holding Ltd | 23.16 | 5.47 | 3.78 | 6.68% | $0.88 | $2.03 | 19.29% |
| Ollie's Bargain Outlet Holdings Inc | 28.87 | 3.68 | 2.66 | 2.24% | $0.06 | $0.21 | 7.79% |
| Nordstrom Inc | 15.26 | 4.03 | 0.27 | 4.75% | $0.3 | $1.31 | 4.34% |
| Macy's Inc | 22.61 | 0.92 | 0.17 | 0.66% | $0.29 | $2.04 | -2.68% |
| Savers Value Village Inc | 23.46 | 3.99 | 1.18 | 5.09% | $0.07 | $0.22 | 0.53% |
| Kohl's Corp | 5.77 | 0.38 | 0.09 | 0.58% | $0.28 | $1.57 | -8.49% |
| Groupon Inc | 15.74 | 10.80 | 0.81 | 34.72% | $0.03 | $0.1 | -9.48% |
| Average | 20.84 | 5.32 | 1.67 | 7.12% | $6.98 | $14.45 | 7.92% |
Upon a comprehensive analysis of Amazon.com, the following trends can be discerned:
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Notably, the current Price to Earnings ratio for this stock, 47.72, is 2.29x above the industry norm, reflecting a higher valuation relative to the industry.
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With a Price to Book ratio of 9.06, which is 1.7x 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 3.85, which is 2.31x 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 0.93% 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 Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $32.08 Billion is 4.6x above the industry average, highlighting stronger profitability and robust cash flow generation.
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With higher gross profit of $31.0 Billion, which indicates 2.15x above the industry average, the company demonstrates 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 7.92%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio indicates the proportion of debt and equity used by a company to finance its assets and operations.
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 comparing Amazon.com with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:
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Amazon.com is in a relatively stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.52.
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This implies that the company relies less on debt financing and has a more favorable balance between debt and equity.
Key Takeaways
For Amazon.com, the PE, PB, and PS ratios are all high compared to its peers in the Broadline Retail industry, indicating overvaluation. The low ROE suggests lower profitability relative to its high EBITDA and gross profit margins. Additionally, the high revenue growth rate may be driving the high valuation multiples for Amazon.com 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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