10Y annualized return is
excellent
at 24.4% per year
AMZN has met or exceeded earnings expectations in
most
recent quarters (9/10)
Strong Return on Equity
Reasonable Price-to-Sales Ratio
Healthy Gross Profit Margin
Positive Net Profit Margin
Strong Interest Coverage
Low Debt Levels
Strong Revenue Growth
Improved Operating Income
High Third-Party Seller Mix
Consistent Cost Reduction
Investment in AI and Robotics
Expansion of AWS and Generative AI
Enhanced Delivery and Prime Services
High Price-to-Earnings Ratio
Elevated Price-to-Cash Flow Ratio
Moderate Operating Profit Margin
Low Quick Ratio
Foreign Exchange Impact
Supply Chain Constraints
Overall, Amazon demonstrates a robust business model with strong revenue growth, improved operating income, and a high percentage of third-party sales. Future prospects appear favorable with investments in AI and continued growth in AWS, although supply chain constraints may pose short-term challenges.
Analysis Date: February 6, 2025
Last Updated: March 11, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
Amazon.com, Inc. is a big online store where you can buy all kinds of products like books, electronics, clothes, and more. They also have a membership program called Amazon Prime, which gives you benefits like free shipping and access to movies and music. Besides selling products, Amazon helps other businesses sell their items on their platform and offers services like cloud computing, which helps companies store and manage data online. Founded in 1994 and based in Seattle, Amazon connects shoppers, sellers, and content creators from all over the world.
Streams of revenue
Geographic Distribution
Core Products
Business Type
Mixed Business Model
Competitive Advantages
Key Business Risks
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Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$217.80
Current Market Price: $173.04
IV/P Ratio: 1.26x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
21.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for AMZN
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (30.23)
P/B ratio ≤ 1.5 (6.26)
Current ratio ≥ 2.0 (1.06x)
Long-term debt < Net current assets (11.86x)
Margin of safety (21.0%)
AMZN does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
23.74%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
48.85%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
9.29%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
A gross profit margin of 48.17% indicates that AMZN retains a significant portion of revenue after the cost of goods sold, showcasing strong pricing power.
The net profit margin of 9.29% reflects that AMZN is generating profit from its revenues, which is a positive sign of financial performance.
An operating profit margin of 10.75% indicates room for improved operational efficiency, as it is lower than industry averages for high-performing tech companies.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.46x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
1.06x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
An interest coverage ratio of 28.51 demonstrates that AMZN can comfortably meet its interest obligations, indicating strong financial health.
A debt-to-equity ratio of 0.46 signals that AMZN has a manageable level of debt compared to its equity, reflecting prudent financial management.
A quick ratio of 0.87 suggests that AMZN may have trouble covering its short-term liabilities without relying on inventory sales, indicating potential liquidity concerns.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
Amazon reported $187.8 billion in revenue for Q4 2024, representing a 10% year-over-year increase. This growth showcases the company's resilience in a competitive market.
Operating income reached $21.2 billion, a significant 61% increase from the previous year, indicating improved operational efficiency and cost management.
61% of items sold were from third-party sellers, the highest annual mix recorded, reflecting Amazon's effective marketplace strategy and broad selection.
For the second consecutive year, Amazon reduced its global cost to serve on a per-unit basis, enhancing profitability while maintaining service quality.
A stronger dollar resulted in an unexpected $700 million foreign exchange headwind, which could affect future revenue projections.
Amazon is heavily investing in AI capabilities and robotics, which are expected to enhance operational efficiency and customer experience significantly.
AWS continues to grow at a healthy 19% year-over-year, with an annualized revenue run rate of $115 billion, driven by strong demand for generative AI solutions.
Continued improvements in delivery speed and expansion of Prime benefits are expected to drive customer retention and growth in everyday essentials.
AWS growth is somewhat moderated by supply chain constraints, particularly in chip availability, which could limit growth potential temporarily.