Amazon.com, Inc. Fundamental Analysis
Amazon.com, Inc. (AMZN) shows moderate financial fundamentals with a PE ratio of 30.09, profit margin of 12.22%, and ROE of 23.34%. The company generates $743.8B in annual revenue with strong year-over-year growth of 12.38%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 62.3/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze AMZN's fundamental strength across five key dimensions:
Efficiency Score
WeakAMZN struggles to generate sufficient returns from assets.
Valuation Score
ModerateAMZN shows balanced valuation metrics.
Growth Score
ExcellentAMZN delivers strong and consistent growth momentum.
Financial Health Score
ExcellentAMZN maintains a strong and stable balance sheet.
Profitability Score
WeakAMZN struggles to sustain strong margins.
Key Financial Metrics
Is AMZN Expensive or Cheap?
P/E Ratio
AMZN trades at 30.09 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, AMZN's PEG of 0.85 indicates potential undervaluation.
Price to Book
The market values Amazon.com, Inc. at 6.18 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.31 times EBITDA. This signals the market has high growth expectations.
How Well Does AMZN Make Money?
Net Profit Margin
For every $100 in sales, Amazon.com, Inc. keeps $12.22 as profit after all expenses.
Operating Margin
Core operations generate 11.50 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $23.34 in profit for every $100 of shareholder equity.
ROA
Amazon.com, Inc. generates $9.91 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Amazon.com, Inc. produces operating cash flow of $148.73B, showing steady but balanced cash generation.
Free Cash Flow
Amazon.com, Inc. generates weak or negative free cash flow of $-2.48B, restricting financial flexibility.
FCF Per Share
Each share generates $-0.23 in free cash annually.
FCF Yield
AMZN converts -0.09% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
30.09
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.85
vs 25 benchmark
P/B Ratio
Price to book value ratio
6.18
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.68
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.47
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.18
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.23
vs 25 benchmark
ROA
Return on assets percentage
0.10
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How AMZN Stacks Against Its Sector Peers
| Metric | AMZN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 30.09 | 24.20 | Worse (Expensive) |
| ROE | 23.34% | 1170.00% | Weak |
| Net Margin | 12.22% | 2530.00% | Weak |
| Debt/Equity | 0.47 | 0.72 | Strong (Low Leverage) |
| Current Ratio | 1.18 | 2.82 | Neutral |
| ROA | 9.91% | -8380.00% (disorted) | Weak |
AMZN outperforms its industry in 1 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Amazon.com, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
74.27%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
241.70%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
98.18%
Industry Style: Cyclical, Growth, Discretionary
High Growth