Amazon.com (AMZN) & Its Rivals Critical Analysis

Amazon.com (NASDAQ: AMZN) is one of 20 publicly-traded companies in the “Catalog & mail-order houses” industry, but how does it compare to its competitors? We will compare Amazon.com to related businesses based on the strength of its earnings, risk, analyst recommendations, profitability, dividends, institutional ownership and valuation.

Insider and Institutional Ownership

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60.2% of Amazon.com shares are owned by institutional investors. Comparatively, 51.9% of shares of all “Catalog & mail-order houses” companies are owned by institutional investors. 17.7% of Amazon.com shares are owned by company insiders. Comparatively, 35.8% of shares of all “Catalog & mail-order houses” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Amazon.com has a beta of 1.59, suggesting that its stock price is 59% more volatile than the S&P 500. Comparatively, Amazon.com’s competitors have a beta of 1.72, suggesting that their average stock price is 72% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings for Amazon.com and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amazon.com 0 4 45 1 2.94
Amazon.com Competitors 106 502 1893 47 2.74

Amazon.com presently has a consensus target price of $1,482.05, indicating a potential upside of 5.47%. As a group, “Catalog & mail-order houses” companies have a potential upside of 32.98%. Given Amazon.com’s competitors higher probable upside, analysts plainly believe Amazon.com has less favorable growth aspects than its competitors.

Valuation & Earnings

This table compares Amazon.com and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Amazon.com $177.87 billion $3.03 billion 308.84
Amazon.com Competitors $13.26 billion $261.34 million 34.58

Amazon.com has higher revenue and earnings than its competitors. Amazon.com is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Amazon.com and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amazon.com 1.71% 9.23% 2.16%
Amazon.com Competitors -0.91% -1,896.22% -2.40%

Summary

Amazon.com beats its competitors on 10 of the 13 factors compared.

Amazon.com Company Profile

Amazon.com, Inc. engages in the retail sale of consumer products and subscriptions in North America and internationally. The company operates through three segments: North America, International, and Amazon Web Services (AWS) segments. It sells merchandise and content purchased for resale from vendors, as well as those offered by third-party sellers through physical stores and retail Websites, such as amazon.com, amazon.ca, amazon.com.mx, amazon.com.au, amazon.com.br, amazon.cn, amazon.fr, amazon.de, amazon.in, amazon.it, amazon.co.jp, amazon.nl, amazon.es, and amazon.co.uk. The company also manufactures and sells electronic devices, including kindle e-readers, fire tablets, fire TVs, and echo devices; and provides Kindle Direct Publishing, an online service that allows independent authors and publishers to make their books available in the Kindle Store. In addition, it offers programs that enable sellers to sell their products on its Websites, as well as their own branded Websites; and programs that allow authors, musicians, filmmakers, app developers, and others to publish and sell content. Further, the company provides compute, storage, database, and other AWS services, as well as fulfillment, publishing, digital content subscriptions, advertising, and co-branded credit card agreement services. Additionally, it offers Amazon Prime, a membership program, which provides free shipping of various items; access to unlimited streaming of movies and TV episodes; and other services. It serves consumers, sellers, developers, enterprises, and content creators. The company was founded in 1994 and is headquartered in Seattle, Washington.

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