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 (NASDAQ: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 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 21.93 5.33 3.82 12.61% $102.16 $104.83 19.62%
MercadoLibre Inc 50.74 13.39 3.06 5.94% $0.89 $3.86 49.03%
eBay Inc 23.45 10.58 4.26 11.34% $0.77 $2.29 19.5%
Dillard's Inc 14.66 4.75 1.46 13.17% $0.27 $0.72 2.69%
Global E Online Ltd 62.04 7.66 7.19 3.29% $0.04 $0.11 32.76%
Macy's Inc 10.54 1.39 0.31 1.3% $0.33 $2.03 2.07%
Ollie's Bargain Outlet Holdings Inc 19.40 2.51 1.77 2.99% $0.09 $0.28 14.25%
Kohl's Corp 8.26 0.55 0.15 -0.35% $0.22 $1.36 -2.04%
Savers Value Village Inc 77.86 3.90 1.03 -1.22% $0.03 $0.22 8.93%
Hour Loop Inc 36.55 8.23 0.44 11.12% $0.0 $0.02 15.84%
Average 33.72 5.88 2.19 5.29% $0.29 $1.21 15.89%

By closely studying Amazon.com, we can observe the following trends:

  • A Price to Earnings ratio of 21.93 significantly below the industry average by 0.65x suggests undervaluation. This can make the stock appealing for those seeking growth.

  • Considering a Price to Book ratio of 5.33, which is well below the industry average by 0.91x, the stock may be undervalued based on its book value compared to its peers.

  • The Price to Sales ratio of 3.82, which is 1.74x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

  • The Return on Equity (ROE) of 12.61% is 7.32% above the industry average, highlighting efficient use of equity to generate profits.

  • The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $102.16 Billion is 352.28x above the industry average, highlighting stronger profitability and robust cash flow generation.

  • The gross profit of $104.83 Billion is 86.64x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.

  • The company's revenue growth of 19.62% exceeds the industry average of 15.89%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

debt to equity

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.

By considering the Debt-to-Equity ratio, Amazon.com can be compared to its top 4 peers, leading to the following observations:

  • 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 0.4.

  • 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 and PB ratios are low compared to peers in the Broadline Retail industry, indicating potential undervaluation. However, the PS ratio is high, suggesting a premium valuation based on revenue. In terms of profitability metrics, Amazon.com shows high ROE, EBITDA, and gross profit margins, outperforming industry peers. Additionally, the company's strong revenue growth further highlights its competitive position within the sector.

This article was generated by Benzinga's automated content engine and reviewed by an editor.