Performance Comparison: Amazon.com And Competitors In Broadline Retail Industry
The article compares Amazon.com with its competitors in the Broadline Retail industry, analyzing financial metrics such as P/E, P/B, and revenue growth. Amazon shows a P/E ratio of 30.26, indicating potential growth, but a high P/B ratio suggests possible overvaluation. With an ROE of 7.34% and EBITDA of $38.55 billion, Amazon outperforms peers in profitability and revenue growth at 10.49%. Its lower debt-to-equity ratio of 0.46 indicates a stronger financial position. Overall, Amazon demonstrates strong financial performance and growth potential compared to its industry rivals.
Amidst today's fast-paced and highly competitive business environment, it is crucial for investors and industry enthusiasts to conduct comprehensive company evaluations. 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 | 30.26 | 6.21 | 2.81 | 7.34% | $38.55 | $88.9 | 10.49% |
| Alibaba Group Holding Ltd | 16.32 | 1.94 | 2.02 | 5.01% | $59.0 | $117.63 | 7.61% |
| PDD Holdings Inc | 9.17 | 3.09 | 2.62 | 9.28% | $29.18 | $59.65 | 11.33% |
| MercadoLibre Inc | 54.56 | 23.96 | 5.02 | 15.3% | $0.96 | $2.75 | 37.42% |
| JD.com Inc | 9.36 | 1.52 | 0.33 | 4.21% | $12.54 | $53.12 | 13.37% |
| Coupang Inc | 264.12 | 9.33 | 1.27 | 3.76% | $0.44 | $2.49 | 21.4% |
| eBay Inc | 16.62 | 5.93 | 3.20 | 12.84% | $0.76 | $1.86 | 0.66% |
| Ollie's Bargain Outlet Holdings Inc | 32.97 | 3.85 | 2.90 | 4.14% | $0.1 | $0.27 | 2.79% |
| Vipshop Holdings Ltd | 6.32 | 1.17 | 0.45 | 6.31% | $3.29 | $7.63 | -4.18% |
| Dillard's Inc | 8.55 | 2.75 | 0.77 | 11.4% | $0.31 | $0.74 | -4.97% |
| MINISO Group Holding Ltd | 14.05 | 3.51 | 2.16 | 8.12% | $0.88 | $2.03 | 4.2% |
| Nordstrom Inc | 13.68 | 3.49 | 0.27 | 15.61% | $0.44 | $1.69 | -2.17% |
| Macy's Inc | 5.20 | 0.66 | 0.13 | 7.86% | $0.68 | $3.02 | -4.39% |
| Savers Value Village Inc | 55.29 | 3.54 | 1.02 | -0.44% | $0.04 | $0.22 | 5.02% |
| Kohl's Corp | 7.16 | 0.21 | 0.05 | 1.26% | $0.31 | $1.92 | -9.39% |
| Hour Loop Inc | 61 | 8.31 | 0.31 | -25.78% | $-0.0 | $0.02 | -8.51% |
| Average | 38.29 | 4.88 | 1.5 | 5.26% | $7.26 | $17.0 | 4.68% |
When analyzing Amazon.com, the following trends become evident:
With a Price to Earnings ratio of 30.26, which is 0.79x less than the industry average, the stock shows potential for growth at a reasonable price, making it an interesting consideration for market participants.
The elevated Price to Book ratio of 6.21 relative to the industry average by 1.27x suggests company might be overvalued based on its book value.
The stock's relatively high Price to Sales ratio of 2.81, surpassing the industry average by 1.87x, may indicate an aspect of overvaluation in terms of sales performance.
The Return on Equity (ROE) of 7.34% is 2.08% above the industry average, highlighting efficient use of equity to generate profits.
The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $38.55 Billion, which is 5.31x above the industry average, indicating stronger profitability and robust cash flow generation.
Compared to its industry, the company has higher gross profit of $88.9 Billion, which indicates 5.23x above the industry average, indicating stronger profitability and higher earnings from its core operations.
The company is experiencing remarkable revenue growth, with a rate of 10.49%, outperforming the industry average of 4.68%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.
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 light of the Debt-to-Equity ratio, a comparison between Amazon.com and its top 4 peers reveals the following information:
Compared to its top 4 peers, Amazon.com has a stronger financial position indicated by its lower debt-to-equity ratio of 0.46.
This suggests that the company relies less on debt financing and has a more favorable balance between debt and equity, which can be seen as a positive attribute 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.