Home News Momentum Stocks in Ratio Analysis: Amazon.com, Inc. (NASDAQ:AMZN)

Momentum Stocks in Ratio Analysis: Amazon.com, Inc. (NASDAQ:AMZN)


Amazon.com, Inc. (NASDAQ:AMZN) try to takes its position in context of active momentum, while shares price slightly down -0.16% during latest trading session. Amazon continues its land grab in the grocery market by aggressively pricing common items and eliminating Amazon Fresh delivery service fees for Prime members. To siphon off customers from its biggest supermarket rivals, Walmart and Kroger, the e-commerce giant is undercutting prices on key items, according to an industry note released Monday by Oppenheimer.

The head-to-head comparison comes after Amazon last month announced it won’t charge Prime members for Amazon Fresh. Previously, Prime members had to pay $14.99 per month for the additional benefit. The service isn’t available to non-Prime members.

Several salient technical indicators of firm are now starting to make their way into the trading conversation. Every investor and other stake holder of firm are most concerned with its profitability. So to answer this concerns frequently used tools of financial ratio analysis, is profitability ratios, which are used to determine the company’s bottom line and its return to its investors.

Start focusing on ordinary profitability ratio which covers margins; AMZN has gross profit margin ratio of 41.10% for trailing twelve months and operating margin is calculated as 5.40%, these are better detectors to find consistency or positive/negative trends in a firm’s earnings. So upper calculated figures are representing the firm’s ability to translate sales dollars into profits at various stages of measurement. To walk around the gross margin figure of firm that looks at how well a company controls the cost of its inventory and the manufacturing of its products and subsequently pass on the costs to its consumers.

Following in trace line of profitability ration analysis; second part is covering returns. The returns on investment amplify the findings, the firm’s ROI concludes as 11.90%; it gives idea for personal financial decisions, to compare a firm’s profitability or to compare the efficiency of different investments. The returns on assets of firm also on noticeable level, it has ROA of 6.20%, which signifies how profitable a firm is relative to its total assets.

To make strengthen these views, the active industry Amazon.com, Inc. (NASDAQ:AMZN) has Quick Ratio of 0.80, which indicates firm has sufficient short-term assets to cover its immediate liabilities. In addition, the firm has debt to equity ratio of 0.71, sometimes it remains same with long term debt to equity ratio. Taking notice on volatility measures, price volatility of stock was 0.97% for a week and 1.44% for a month.



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