In today's rapidly evolving and fiercely competitive business landscape, it is crucial for investors and industry analysts to conduct comprehensive company evaluations. In this article, we will undertake an in-depth industry comparison, assessing Amazon.com (NASDAQ:AMZN) alongside its primary competitors in the Broadline Retail industry. By meticulously examining crucial financial indicators, market positioning, and growth potential, we aim to provide valuable insights to 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 74% of total, followed by Amazon Web Services (17%), and advertising services (9%). International segments constitute 22% of Amazon's total revenue, 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 | 33.46 | 6.28 | 3.62 | 5.43% | $46.76 | $103.43 | 13.63% |
| MercadoLibre Inc | 46.50 | 13.76 | 3.21 | 8.62% | $1.07 | $3.78 | 44.56% |
| eBay Inc | 23.04 | 9.53 | 4.14 | 11.31% | $0.8 | $2.12 | 14.97% |
| Coupang Inc | 183.18 | 7.97 | 1.08 | -0.56% | $0.17 | $2.54 | 10.92% |
| Dillard's Inc | 16.30 | 5.21 | 1.42 | 10.66% | $0.3 | $0.72 | -3.03% |
| Ollie's Bargain Outlet Holdings Inc | 23.58 | 2.96 | 2.14 | 4.6% | $0.13 | $0.31 | 16.82% |
| Global E Online Ltd | 78.33 | 5.50 | 5.59 | 6.69% | $0.13 | $0.15 | 28.05% |
| Macy's Inc | 8.29 | 1.04 | 0.24 | 11.04% | $0.9 | $2.97 | -1.14% |
| Kohl's Corp | 5.66 | 0.37 | 0.10 | 3.13% | $0.39 | $1.85 | -4.15% |
| Savers Value Village Inc | 58.71 | 2.93 | 0.80 | 5.28% | $0.07 | $0.26 | 15.59% |
| Hour Loop Inc | 36.63 | 9.21 | 0.45 | -8.96% | $-0.0 | $0.03 | 3.03% |
| Average | 48.02 | 5.85 | 1.92 | 5.18% | $0.4 | $1.47 | 12.56% |
When closely examining Amazon.com, the following trends emerge:
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At 33.46, the stock's Price to Earnings ratio is 0.7x less than the industry average, suggesting favorable growth potential.
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The elevated Price to Book ratio of 6.28 relative to the industry average by 1.07x suggests company might be overvalued based on its book value.
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The Price to Sales ratio of 3.62, which is 1.89x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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With a Return on Equity (ROE) of 5.43% that is 0.25% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $46.76 Billion is 116.9x above the industry average, highlighting stronger profitability and robust cash flow generation.
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The gross profit of $103.43 Billion is 70.36x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
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The company is experiencing remarkable revenue growth, with a rate of 13.63%, outperforming the industry average of 12.56%.
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.
When examining Amazon.com in comparison to its top 4 peers with respect to the Debt-to-Equity ratio, the following information becomes apparent:
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In terms of the debt-to-equity ratio, Amazon.com has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.
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This implies that the company relies less on debt financing and has a more favorable balance between debt and equity with a lower debt-to-equity ratio of 0.37.
Key Takeaways
For Amazon.com in the Broadline Retail industry, the PE ratio is low compared to peers, indicating potential undervaluation. The PB and PS ratios are high, suggesting overvaluation relative to industry standards. In terms of ROE, EBITDA, gross profit, and revenue growth, Amazon.com demonstrates strong performance compared to industry peers, reflecting favorable financial health and growth prospects.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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