AMZN Stock Overview
Amazon.com, Inc. engages in the retail sale of consumer products and subscriptions in North America and internationally.
Price History & Performance
|Historical stock prices|
|Current Share Price||US$114.41|
|52 Week High||US$188.11|
|52 Week Low||US$101.26|
|1 Month Change||-12.50%|
|3 Month Change||5.04%|
|1 Year Change||-30.99%|
|3 Year Change||31.84%|
|5 Year Change||139.08%|
|Change since IPO||116,745.05%|
Recent News & Updates
Amazon's Bear Market Insurance
Summary Three ways to protect capital in a bear market. Deposits, litigation, and merger arbitrage. Here’s one of the latest opportunities to consider. Deposits Where is the first place I look for bear market insurance? Federally insured deposit accounts. Join a credit union such as Affinity FCU. They offer rates up to 3.5% APY and $250k of federal deposit insurance. If they convert to a bank someday, you could get preferential access to an equity offering worth millions. Eastern (EBC) holders that fully participated in that demutualization have each made $2,278,000 so far excluding dividends that we've received, quickly more than doubling our investment with virtually no risk to original invested capital. Worth the wait. Litigation The second place to look is litigation. StW's best idea for 2022, Renren (RENN) is a litigation play that could work this year regardless of what the broader indexes do. YCharts One focus in our new StW newsletter has been what to do with their RENN profits. Arbitrage Last but not least: definitive merger arbitrage. Pre-arbitrage takeover candidates have had a disastrous 2022, but definitive merger arbitrage has hung in there. The newsletter picks include two definitive merger arbitrage ideas, Nielsen (NLSN) (since completed) and Twitter (TWTR) (a work in process). SA SA Who? Twitter remains my favorite component of our merger arbitrage basket and at this point you missed Nielsen, but there is a new opportunity to consider. Amazon (AMZN) is buying iRobot (IRBT) for $61 per share in cash. The target makes robots. IRBT What? The deal requires approvals from the US, EU, and the target's shareholders. When? The deal will probably close by the second quarter of 2023. Where? The target sells their products in the US, Europe, Middle East, Africa, and Japan. They are headquartered in Massachusetts. Why?
Tips On Amazon From Nick Sleep's Nomad Letters
Summary Amazon was one of the first and largest investments in Nomad Partnership's Fund. Nick Sleep gave advice on how to evaluate companies like Amazon, who both invest lots in R&D and give back to customers in price reduction. The delayed gratification of reinvesting in the business and giving back to the customers instead of giving back to shareholders creates amazing internal compounding of the business. We'll also take a look at how R&D expense tax changes post 2022 will affect the strategies of Amazon in future years. With Amazon, R&D is key This article is going to give tips on how to evaluate Amazon (AMZN), with some assistance from the Nomad Partnership letters. For those unfamiliar with Nick Sleep and Qais Zakaria, they ran their fund from 2001-2014 and had a total return of over 900% during that period. This was a value fund, with its sole intention at heart to buy a dollar for .50 cents. It later became a quality fund, looking for internal compounding growth and economies of scale as its targets. Both Sleep and Zakaria are secretive and low-key, it is near impossible to find a documented interview of either manager. These letters are one of the only reliable resources to study their methodologies Methodologies for finding values include references to Buffett, Munger, Graham, Peter Lynch, Joel Greenblatt, and Bill Miller. Like Bill Miller, Nomad Partnership staked a large portion of its capital into Amazon, accounting for a big chunk of their total returns. Another famous value investor, Mohnish Pabrai has stated that the study of Nomad had a great effect on his thought process and remains friends with Nick Sleep to this day. A previous article, I wrote addressing my price target on Amazon, goes over some general sleuthing on how to look under the hood on fast-growing companies not showing a ton of earnings. Using an adjusted PEG ratio formula substituting EBITDA for net earnings, we saw that Amazon has been growing EBITDA at a rate of 32.15% compounded for the past 5 years. We used 32.15 as our multiplier and $5 per share in EBITDA as our multiplicand. The adjusted price target came out to $160 as fair value. This did not take into account the massive R&D spend that Amazon takes every year. My thesis is Amazon is a buy. The analysis provided below reinforces my belief that the future of Amazon's earnings also has hidden buffers already built into it. Nick Sleep's notes on Amazon A paperback version of the Nomad letters can be found here with commentary by the author under the pseudonym the "rational cloner". A good analysis of Amazon can be seen in their December 31st, 2006 letter to shareholders: Take for example the current controversy at Amazon.com. Last year the company reported free cash flow of just over U$500m, indeed it has been around this number for the last few years. What is important is that the U$500m is after all investment spending on growth initiatives such as capital spending, but also research and development, shipping subsidy, marketing and advertising and price givebacks. A bit later in the letter, Nick Sleep's analysis points out: By our estimates these discretionary investments, over and above that required to maintain the business are in the region of a further U$500m, excluding price givebacks. This is our subjective assessment of the discretionary investment spend and implies the management could, if so inclined, cancel the discretionary growth spending and instead return around U$800m per annum to investors after taxes. - Nick Sleep December 31st, 2006 He determined that if free cash flow was actually including discretionary spending, the free cash flow number would be much higher, thus commanding a higher price with a change in the multiple and (free cash flow). The problem with typical assessments of growth companies using standard formulas to evaluate them discounts the fact that the highest R&D spenders in the world purposely show lower net income. This provides a compounding effect where they are subsidized through tax loopholes to continue their growth in revenue and by economies of scale, providing price givebacks to their customers. gapintelligence.com Price givebacks Part of the virtuous cycle of Amazon's growth process has to do with being a low-cost leader. Through smart investments in tax-beneficial vehicles, Amazon can grow and control pricing to a greater and greater extent over time. Instead of trying to increase margins on these businesses, they instead lower the cost to you and create a more loyal customer. The Nomad letters point out that large, low-margin businesses can be very attractive indeed. Scale of economics shared operations are quite different. As the firm grows in size, scale savings are given back to the customer in the form of lower prices. The customer then reciprocates by purchasing more goods, which provides greater scale for the retailer who passes on the new savings as well. Yippee.- Nick Sleep December 31st, 2008 If you're a first mover in a given business segment, it becomes better to gain less and less in margins over time and increase revenue vs increasing margins by price gouging customers. The lower margins deter competition. By the time an entrant tries to compete with you on price, they may be cutting below their cost. Game over. How much does Amazon spend on R&D? The most current fiscal year saw Amazon R&D spend at $62 Billion. That's an enormous amount, more than Apple (AAPL) or Google (GOOGL) (GOOG). Let's pretend for a moment that this optional item was canceled, what would be reflected in EBITDA and cash flow then? With another $62 Billion added to those items, it would effectively cut the price to free cash flow or EV/EBITDA multiples in half. An extra $62 Billion would be more than their current EBITDA and be a top 2 or 3 amount of free cash flow in the stock market. I do realize that some of the R&D spending was borrowed money, rather than taken out of cash from operations. That being said, there are only a handful of companies out there where this type of analysis even applies. Further benefits to R&D The following is a snippet from the most recent Amazon form 10-K: Intangible assets acquired in a business combination that are in-process and used in research and development activities are considered indefinite-lived until the completion or abandonment of the research and development efforts. Once the research and development efforts are completed, we determine the useful life and begin amortizing the assets. This points out a very interesting compounding effect of research and development that provides additional tax benefits. If a company is effective in using its research and development expense, they then create a valuable intangible asset. When this asset is created, they then move this asset to the balance sheet to be amortized, providing further tax deductions. Amortization expense for acquired finite-lived intangibles was $565 million, $509 million, and $512 million in 2019, 2020, and 2021. Thus, on top of the R&D tax credit, Amazon is also carrying forward an additional half a billion dollars a year in amortization expenses. The delayed gratification in realized earnings is certainly building in a lot of tax sheltering for future use. Changes to the laws Some future R&D expense tax law items were also brought to light in the most recent Amazon 10-K: Tax benefits relating to excess stock-based compensation deductions and accelerated depreciation deductions are reducing our U.S. taxable income. U.S. tax rules provide for enhanced accelerated depreciation deductions by allowing the election of full expensing of qualified property, primarily equipment, through 2022. Our federal tax provision included the election of full expensing of qualified property for 2019 and a partial election for 2020 and 2021. Cash taxes paid (net of refunds) were $1.7 billion and $3.7 billion for 2020 and 2021. Effective January 1, 2022, research and development expenses are required to be capitalized and amortized for U.S. tax purposes, which will delay the deductibility of these expenses and potentially increase the amount of cash taxes we pay.
|AMZN||US Online Retail||US Market|
Return vs Industry: AMZN exceeded the US Online Retail industry which returned -39.2% over the past year.
Return vs Market: AMZN underperformed the US Market which returned -23.7% over the past year.
|AMZN Average Weekly Movement||6.2%|
|Online Retail Industry Average Movement||10.6%|
|Market Average Movement||6.9%|
|10% most volatile stocks in US Market||15.7%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: AMZN is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.
Volatility Over Time: AMZN's weekly volatility (6%) has been stable over the past year.
About the Company
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). It sells merchandise and content purchased for resale from third-party sellers through physical and online stores.
Amazon.com Fundamentals Summary
|AMZN fundamental statistics|
Is AMZN overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|AMZN income statement (TTM)|
|Cost of Revenue||US$278.69b|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
|Earnings per share (EPS)||1.14|
|Net Profit Margin||2.39%|
How did AMZN perform over the long term?See historical performance and comparison
Is AMZN undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 3/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for AMZN?
Other financial metrics that can be useful for relative valuation.
|What is AMZN's n/a Ratio?|
Price to Earnings Ratio vs Peers
How does AMZN's PE Ratio compare to its peers?
|AMZN PE Ratio vs Peers|
|Company||PE||Estimated Growth||Market Cap|
BABA Alibaba Group Holding
Price-To-Earnings vs Peers: AMZN is expensive based on its Price-To-Earnings Ratio (100.4x) compared to the peer average (25.9x).
Price to Earnings Ratio vs Industry
How does AMZN's PE Ratio compare vs other companies in the US Online Retail Industry?
Price-To-Earnings vs Industry: AMZN is expensive based on its Price-To-Earnings Ratio (100.4x) compared to the US Online Retail industry average (20.3x)
Price to Earnings Ratio vs Fair Ratio
What is AMZN's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PE Ratio||100.4x|
|Fair PE Ratio||71.1x|
Price-To-Earnings vs Fair Ratio: AMZN is expensive based on its Price-To-Earnings Ratio (100.4x) compared to the estimated Fair Price-To-Earnings Ratio (71.1x).
Share Price vs Fair Value
What is the Fair Price of AMZN when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: AMZN ($114.41) is trading below our estimate of fair value ($290.68)
Significantly Below Fair Value: AMZN is trading below fair value by more than 20%.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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How is Amazon.com forecast to perform in the next 1 to 3 years based on estimates from 47 analysts?
Future Growth Score4/6
Future Growth Score 4/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: AMZN's forecast earnings growth (53.2% per year) is above the savings rate (1.9%).
Earnings vs Market: AMZN's earnings (53.2% per year) are forecast to grow faster than the US market (14.7% per year).
High Growth Earnings: AMZN's earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: AMZN's revenue (13.1% per year) is forecast to grow faster than the US market (7.6% per year).
High Growth Revenue: AMZN's revenue (13.1% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: AMZN's Return on Equity is forecast to be low in 3 years time (16.4%).
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How has Amazon.com performed over the past 5 years?
Past Performance Score1/6
Past Performance Score 1/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: AMZN has a high level of non-cash earnings.
Growing Profit Margin: AMZN's current net profit margins (2.4%) are lower than last year (6.6%).
Past Earnings Growth Analysis
Earnings Trend: AMZN's earnings have grown significantly by 35.7% per year over the past 5 years.
Accelerating Growth: AMZN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: AMZN had negative earnings growth (-60.6%) over the past year, making it difficult to compare to the Online Retail industry average (-41.1%).
Return on Equity
High ROE: AMZN's Return on Equity (8.8%) is considered low.
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How is Amazon.com's financial position?
Financial Health Score3/6
Financial Health Score 3/6
Short Term Liabilities
Long Term Liabilities
Financial Position Analysis
Short Term Liabilities: AMZN's short term assets ($133.7B) do not cover its short term liabilities ($140.3B).
Long Term Liabilities: AMZN's short term assets ($133.7B) do not cover its long term liabilities ($148.0B).
Debt to Equity History and Analysis
Debt Level: AMZN's net debt to equity ratio (13.6%) is considered satisfactory.
Reducing Debt: AMZN's debt to equity ratio has increased from 38.4% to 59.8% over the past 5 years.
Debt Coverage: AMZN's debt is well covered by operating cash flow (45.3%).
Interest Coverage: AMZN's interest payments on its debt are well covered by EBIT (10x coverage).
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What is Amazon.com current dividend yield, its reliability and sustainability?
Dividend Score 0/6
Cash Flow Coverage
Dividend Yield vs Market
|Amazon.com Dividend Yield vs Market|
|Market Bottom 25% (US)||1.7%|
|Market Top 25% (US)||4.7%|
|Industry Average (Online Retail)||1.1%|
|Analyst forecast in 3 Years (Amazon.com)||0%|
Notable Dividend: Unable to evaluate AMZN's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate AMZN's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if AMZN's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if AMZN's dividend payments have been increasing.
Earnings Payout to Shareholders
Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: Unable to calculate sustainability of dividends as AMZN has not reported any payouts.
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Andy Jassy (54 yo)
Mr. Andrew R. Jassy, also known as Andy, has been President, Chief Executive Officer and Director at Amazon.com, Inc. since July 5, 2021. He served as Chief Executive Officer of Amazon Web Services Inc. at...
CEO Compensation Analysis
|Andy Jassy's Compensation vs Amazon.com Earnings|
|Date||Total Comp.||Salary||Company Earnings|
|Jun 30 2022||n/a||n/a|
|Mar 31 2022||n/a||n/a|
|Dec 31 2021||US$213m||US$175k|
|Sep 30 2021||n/a||n/a|
|Jun 30 2021||n/a||n/a|
|Mar 31 2021||n/a||n/a|
|Dec 31 2020||US$36m||US$175k|
|Sep 30 2020||n/a||n/a|
|Jun 30 2020||n/a||n/a|
|Mar 31 2020||n/a||n/a|
|Dec 31 2019||US$349k||US$175k|
|Sep 30 2019||n/a||n/a|
|Jun 30 2019||n/a||n/a|
|Mar 31 2019||n/a||n/a|
|Dec 31 2018||US$20m||US$175k|
|Sep 30 2018||n/a||n/a|
|Jun 30 2018||n/a||n/a|
|Mar 31 2018||n/a||n/a|
|Dec 31 2017||US$194k||US$175k|
|Sep 30 2017||n/a||n/a|
|Jun 30 2017||n/a||n/a|
|Mar 31 2017||n/a||n/a|
|Dec 31 2016||US$36m||US$175k|
|Sep 30 2016||n/a||n/a|
|Jun 30 2016||n/a||n/a|
|Mar 31 2016||n/a||n/a|
|Dec 31 2015||US$175k||US$171k|
Compensation vs Market: Andy's total compensation ($USD212.70M) is above average for companies of similar size in the US market ($USD13.05M).
Compensation vs Earnings: Andy's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
Experienced Management: AMZN's management team is seasoned and experienced (7 years average tenure).
Experienced Board: AMZN's board of directors are considered experienced (6.6 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
|Owner Type||Number of Shares||Ownership Percentage|
|State or Government||3,857,417||0.04%|
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Amazon.com, Inc.'s employee growth, exchange listings and data sources
- Name: Amazon.com, Inc.
- Ticker: AMZN
- Exchange: NasdaqGS
- Founded: 1994
- Industry: Internet and Direct Marketing Retail
- Sector: Retail
- Implied Market Cap: US$1.166t
- Shares outstanding: 10.19b
- Website: https://www.amazon.com
Number of Employees
- Amazon.com, Inc.
- 410 Terry Avenue North
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|AMZN||NasdaqGS (Nasdaq Global Select)||Yes||Common Stock||US||USD||May 1997|
|AMZN||BVL (Bolsa de Valores de Lima)||Yes||Common Stock||PE||USD||May 1997|
|AMZN *||BMV (Bolsa Mexicana de Valores)||Yes||Common Stock||MX||MXN||May 1997|
|AMZ||DB (Deutsche Boerse AG)||Yes||Common Stock||DE||EUR||May 1997|
|AMZN||BVC (Bolsa de Valores de Colombia)||Yes||Common Stock||CO||COP||May 1997|
|AMZN||SNSE (Santiago Stock Exchange)||Yes||Common Stock||CL||USD||May 1997|
|AMZ||XTRA (XETRA Trading Platform)||Yes||Common Stock||DE||EUR||May 1997|
|AMZN||SWX (SIX Swiss Exchange)||Yes||Common Stock||CH||CHF||May 1997|
|AMZN||BIT (Borsa Italiana)||Yes||Common Stock||IT||EUR||May 1997|
|AMZN||WBAG (Wiener Boerse AG)||Yes||Common Stock||AT||EUR||May 1997|
|AMZNCL||SNSE (Santiago Stock Exchange)||Yes||Common Stock||CL||CLP||May 1997|
|AMZ||BUL (Bulgaria Stock Exchange)||Yes||Common Stock||BG||EUR||May 1997|
|AMZN_KZ||KAS (Kazakhstan Stock Exchange)||Yes||Common Stock||KZ||USD||May 1997|
|AMZO34||BOVESPA (Bolsa de Valores de Sao Paulo)||BDR EACH 20 REPR 1 COM||BR||BRL||Feb 2012|
|AMZN||BASE (Buenos Aires Stock Exchange)||CEDEAR EACH 144 REP 1||AR||ARS||Apr 2019|
|AMZND||BASE (Buenos Aires Stock Exchange)||CEDEAR EACH 144 REP 1||AR||USD||Apr 2019|
|AMZN||NEOE (Aequitas Neo Exchange)||DEP REP AMAZON||CA||CAD||Aug 2021|
|AMZ1||DB (Deutsche Boerse AG)||DEP REP AMAZON||DE||EUR||Aug 2021|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/09/27 00:00|
|End of Day Share Price||2022/09/27 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.