Analyzing Amazon.com In Comparison To Competitors In Broadline Retail Industry

In the fast-paced and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Amazon.com (NASDAQ:AMZN) in comparison to its major competitors within the Broadline Retail industry. By analyzing crucial 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	33.48	7.14	3.40	5.79%	$36.48	$78.69	8.62%
Alibaba Group Holding Ltd	16.60	2.10	2.16	1.23%	$59.0	$117.63	-15.6%
PDD Holdings Inc	11.15	3.84	3.18	9.28%	$32.41	$62.81	24.45%
MercadoLibre Inc	63.59	26.19	5.86	10.56%	$0.92	$2.77	36.97%
Coupang Inc	194.57	11.31	1.61	2.53%	$0.36	$2.32	11.16%
JD.com Inc	8.20	1.49	0.31	4.6%	$14.27	$47.85	15.78%
eBay Inc	17.27	6.69	3.41	9.95%	$0.77	$1.86	1.13%
Vipshop Holdings Ltd	7.70	1.42	0.55	6.31%	$3.29	$7.63	-4.18%
Ollie's Bargain Outlet Holdings Inc	36.80	4.31	3.23	4.14%	$0.1	$0.27	2.79%
Dillard's Inc	11.63	3.53	1.02	8.97%	$0.31	$0.74	-24.6%
MINISO Group Holding Ltd	17.43	4.35	2.68	8.12%	$0.99	$2.22	22.68%
Nordstrom Inc	14.13	3.61	0.28	15.61%	$0.44	$1.69	-2.17%
Macy's Inc	5.91	0.75	0.15	7.86%	$0.68	$3.02	-4.39%
Savers Value Village Inc	72.07	3.84	1.08	-1.13%	$0.03	$0.2	4.51%
Kohl's Corp	8.73	0.25	0.06	1.26%	$0.31	$1.92	-9.39%
Hour Loop Inc	130	7.86	0.33	11.93%	$0.0	$0.01	4.68%
Average	41.05	5.44	1.73	6.75%	$7.59	$16.86	4.25%

When analyzing Amazon.com, the following trends become evident:

• The Price to Earnings ratio of 33.48 is 0.82x lower than the industry average, indicating potential undervaluation for the stock.

• The elevated Price to Book ratio of 7.14 relative to the industry average by 1.31x suggests company might be overvalued based on its book value.

• The Price to Sales ratio of 3.4, which is 1.97x 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 5.79% is 0.96% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.

• With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $36.48 Billion, which is 4.81x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

• The gross profit of $78.69 Billion is 4.67x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.

• The company is experiencing remarkable revenue growth, with a rate of 8.62%, outperforming the industry average of 4.25%.

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:

• Amazon.com exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.44.

• This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for 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 the company's assets and sales highly. In terms of ROE, Amazon.com has a lower return on equity compared to its industry peers. However, the high EBITDA, gross profit, and revenue growth indicate strong operational performance and growth potential within the industry sector.

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