Amazon Stock Analysis, Valuation (NASDAQ:AMZN)

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$966.9 $13.61 (1.43%) AMZN stock closing price Aug 22, 2017 (Closing)
Watch Robo Advisor Video of AMZN Stock Analysis
Updated on : Aug 22, 2017
previous close
AMZN 966.9 (0%)
S&P 500 2452.5 (0%)
Closing Price On: Aug 22, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Internet Commerce
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PS Valuation
Rating: ★★★★★★★★★★ (0/5)
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Sector:   Retail-Wholesale.   *PE adjusted for one time items.
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Amazon Analysis Video

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Amazon’s revenue has constantly climbed higher as the company is putting all its efforts to expand its topline. This has led to the creation of massive infrastructure causing Amazon’s assets to increase to over $65 billion. Amazon’s stock analysis highlights the contradiction in the exponential growth of its topline and its non-existent bottom line. After over two decades of operations many investors had started questioning if the zero profit business model of the company will allow it to survive in this heavily contested arena in the future.

show more, Inc. Stock Rating (2.3/5)

Our Amazon stock opinion is based on fundamentals of the company. This Amazon stock analysis is based on latest 2017 Q2 earnings. The stock price analysis takes into account the company's valuation metrics.

Should you buy AMZN stock?

  • The Year Over Year (YoY) revenue growth for Amazon was 24.8% in 2017 Q2.
  • Long term revenue growth has been strong with a 5 year compounded annual growth of 22.5%.
  • The operating cash flow looks good at 19.4 times the net income.

Should you sell AMZN stock?

  • Amazon had a poor average operating margin of 2.3% over the last 4 quarters.
  • Amazon's LTM Net margins were poor at 1.3%.
  • The AMZN stock currently trades at a PE of 245.4, which is expensive, compared to the industry average of 17.7.
  • The company is trading at a price to sales multiple of 3.1, which is higher in comparison to the Internet Commerce industry average of 0.7, making AMZN stock expensive.

Comments on this video and Amazon stock on Amazon stock analysis ($980.35)
AMZN should rise to $1,000 by the end of May 2017
Here is my prediction:
05/25/2017 - $985
05/26/2017 - $990
05/30/2017 - $995
05/31/2017 - $1,000
1 reply
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User on Amazon stock analysis ($745.72)
You're looking at the new age Amazon is the old Walmart of the early eighties where a small investment now could benefit you in the tens of thousands of dollars real soon
4 reply
Davep on Amazon stock analysis ($521.38)
Rise in Amazon Stock can be the effect of success in its alliedservices like Amazon Prime and Web services i.e. cloud computing as stated in this article Can this be the real reason and is it expected to grow even higher in the near future?
2 1 reply
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Vikram on Amazon stock analysis ($540.26)
You might find these articles interesting. Two contradictory views on Amazon. This is a bullish view by a guest author
and a bearish view by another guest author
1 2
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johnwboyd on Amazon stock analysis ($510.55)
bullish how they are over $500/ share with no profits. How do you figure?
1 1 reply
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virendra on Amazon stock analysis ($504.72)
Amazon is over $500/share. I see this due to three factors: Manipulation of news in favour of the company ( Blowing the AWS profitability out of proportion by Amazon bulls and Analysts hiking price targets for the stock, which is not something i would trust given that Institutions hold close to 70% of the stock ( The company continues to underprice its services with the promise that earnings growth will follow, something which hasn't happened for over a decade.

Amazon is a great service provider, but a hugely risky investment. The ride higher will only end in a bigger fall, though the exact time is hard to tell.
3 2
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GrowthInvestor on Amazon stock analysis ($341.96)
$AMZN fire tv which promises to be more for the same price already has a built in audience.. another offering to make the current amazon subscribers stickier.. smart move by Bezos
3 reply
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lisajohn on Amazon stock analysis ($351.63)
Google could well be on the way to plunder the 'cloudy' dreams of Amazon. Yet another price cut from the online search giant.
2 reply
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viren@amigobulls on Amazon stock analysis ($371.51)
Faced with the mounting pressure of sustaining topline growth, looks set for another revenue miss in Q1 2014 as Accounting changes in ebook revenue recognition also fail to bail the e-commerce giant. The future looks harder with the accounting change effect wearing off post Q1 2013. Watch Q2 2014 guidance keenly! We agree with Paulo Santos.
1 1 reply
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alxvallejo on Amazon stock analysis ($540.26)
Well I guess you were crazy wrong with that one
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oracleofwallstreet009 on Amazon stock analysis ($370.53)
The time for a transition to an earnings focussed model has come Mr. Bezos. Amazon attempts to turn black through raises in Amazon prime memberships and increasing the minimum free shipping limit on The risk of losing users is huge which could result in further slowdown. The risk is clearly ahead of you.
2 reply

Amazon’s price trend has reflected this debate which led to a massive fall of over 20% in the stock’s value in 2014. However, the stock has recovered as the Amazon Web Services has helped Amazon to establish a stable bottom line. Amazon stock price history shows that the stock has performed much better than its competitors since the financial recession. The company has crossed an annual revenue run rate of over $100 billion. Even at that scale the company continues to show a growth of over 20%. Amazon’s financial analysis also shows a lot of room for cost cutting, which should help the company to boost its profits.

Amazon PE ratio chart shows a high valuation. However, Given the strong growth in Amazon topline and the recent bottom line strength, Amazon stock should be able to outgrow its valuations. The overall revenue growth and market share are more important for investors. Amazon Web Service (AWS) is the market leader in its category albeit facing huge competitive pressure. Its e-commerce business is also more diversified with stronger infrastructure than other competitors. However, the future of the company will be based on how well it is able to withstand the competitive pressures on all flanks and the overall cost efficiency of its business model.