Amazon.com, Inc. is a multinational technology company founded by Jeff Bezos in 1994. Originally starting as an online bookstore, Amazon has since expanded its operations to include a wide range of products and services, becoming one of the largest e-commerce companies in the world.
One of the key financial ratios used in the Altman Z score model is the working capital to total assets ratio. This ratio provides insight into a company's short-term liquidity position and its ability to cover its short-term obligations with its current assets.
The working capital to total assets ratio for Amazon.com, Inc. has shown a fluctuating trend over the past 10 years. In 2014, the ratio stood at 0.0594, indicating that the company had a healthy amount of working capital relative to its total assets. However, the ratio dipped in the following years, reaching a low of -0.0186 in 2022 before rebounding to 0.0141 in 2023.
The negative ratio in 2022 is a cause for concern as it suggests that Amazon.com, Inc. may have more short-term liabilities than current assets available to cover them. This could potentially lead to liquidity issues and difficulties in meeting its financial obligations.
The working capital to total assets ratio is an important component of the Altman Z score model, which is used to predict the likelihood of a company facing financial distress within the next two years. A low or negative ratio could negatively impact the overall Z score of a company, signaling higher financial risk.
Overall, the trend in the working capital to total assets ratio for Amazon.com, Inc. highlights the importance of closely monitoring liquidity levels and ensuring a healthy balance between current assets and liabilities. Investors and analysts should pay close attention to this ratio as part of a comprehensive financial analysis of the company.
Retained earnings to total assets ratio is a key financial metric that provides insights into a company's profitability and financial health. For Amazon.com, Inc., the trend in this ratio over the past decade reveals interesting patterns that can help investors and analysts assess the company's performance and potential for growth.
Let's take a closer look at the retained earnings to total assets ratio data for Amazon.com, Inc. from 2014 to 2023:
The trend in Amazon.com, Inc.'s retained earnings to total assets ratio shows a consistent increase over the years, indicating that the company has been able to generate more profits and retain a higher portion of it compared to its total assets. This is a positive sign for investors, as it suggests that Amazon.com, Inc. is effectively utilizing its assets to create value and build shareholder wealth.
The steady growth in the retained earnings to total assets ratio for Amazon.com, Inc. reflects the company's strong financial position and potential for future expansion. By retaining a larger portion of its profits, Amazon.com, Inc. has more resources to invest in growth opportunities, research and development, and innovation, which can drive long-term success and profitability.
Overall, the data on the retained earnings to total assets ratio for Amazon.com, Inc. paints a positive picture of the company's financial health and performance, indicating that it is well-positioned for sustained growth and value creation for its shareholders.
One of the key financial ratios that can provide insights into a company's operational efficiency and profitability is the EBIT to Total Assets ratio. This ratio measures how effectively a company is generating earnings before interest and taxes (EBIT) relative to its total assets.
Let's take a closer look at how Amazon.com, Inc. has performed in terms of its EBIT to Total Assets ratio over the past decade:
The trend in Amazon.com, Inc.'s EBIT to Total Assets ratio indicates a mix of positive and negative performance over the years. From 2014 to 2021, the company showed a generally increasing trend in the ratio, reaching a peak in 2021. This suggests that Amazon has been able to generate more earnings from its total assets over time.
However, the dip in the ratio in 2022 to a negative value of -0.0077 raises concerns about the company's profitability and operational efficiency. A negative ratio indicates that the company's EBIT is not sufficient to cover its total assets, which may be a red flag for investors.
Investors should closely monitor Amazon.com, Inc.'s financial performance in the coming years to see if the negative trend in the EBIT to Total Assets ratio in 2022 is a temporary setback or a sign of underlying issues. A consistent decline in this ratio could indicate financial distress and impact the company's stock performance.
Market Value to Total Liabilities Ratio is a key financial metric that provides insights into how the market values a company relative to its total liabilities. In the case of Amazon.com, Inc., we have observed fluctuations in this ratio over the years.
The data shows that the Market Value to Total Liabilities Ratio for Amazon.com, Inc. has varied significantly from 2014 to 2023. The ratio has ranged from a low of 2.7031 in 2022 to a high of 7.2921 in 2021. These fluctuations indicate changing investor perceptions of the company's financial health and growth prospects.
For investors, the Market Value to Total Liabilities Ratio data can serve as a valuable indicator of Amazon.com, Inc.'s market positioning and perceived risk. A higher ratio may suggest that the market values the company's assets more than its liabilities, signaling a strong financial standing. Conversely, a lower ratio could raise concerns about the company's ability to meet its financial obligations.
Investors should closely monitor changes in the Market Value to Total Liabilities Ratio for Amazon.com, Inc. and consider the broader market context when making investment decisions. While fluctuations in the ratio are normal, sustained trends could indicate underlying financial challenges or opportunities that warrant attention.
Overall, the Market Value to Total Liabilities Ratio data provides valuable insights into the market's perception of Amazon.com, Inc.'s financial health and prospects. By analyzing these trends, investors can make informed decisions to optimize their investment strategies.
One of the key financial ratios used to evaluate a company's efficiency in generating sales from its assets is the Sales to Total Assets ratio. This ratio indicates how well a company is utilizing its assets to generate revenue. In the case of Amazon.com, Inc., we will examine the trend of this ratio over the past decade to gain insights into the company's operational efficiency.
The Sales to Total Assets ratio for Amazon.com, Inc. has shown a fluctuating trend over the past decade. In 2014, the ratio stood at 1.6327 and gradually increased to 1.6527 in 2015. However, there was a slight dip in 2016 with a ratio of 1.6305. The ratio experienced a more significant decrease in 2017 to 1.3546, indicating a potential inefficiency in utilizing assets to generate sales. Subsequently, there was a slight improvement in 2018 and 2019 with ratios of 1.4318 and 1.2454 respectively. The ratio continued to decline in the following years, reaching 1.0889 in 2023.
The decreasing trend in the Sales to Total Assets ratio for Amazon.com, Inc. suggests that the company may be facing challenges in efficiently utilizing its assets to generate sales. A declining ratio could indicate inefficiencies in the company's operations or a need to optimize its asset utilization strategies. Investors and analysts may view this trend as a cause for concern, as it could impact the company's overall financial performance and profitability.
As Amazon.com, Inc. continues to navigate the dynamic business environment, it will be essential for the company to address the declining trend in its Sales to Total Assets ratio. Implementing strategies to improve asset utilization and enhance operational efficiency will be crucial for maintaining sustainable growth and profitability in the long term. Investors will closely monitor the company's efforts to reverse this trend and enhance its financial performance.
As we delve into the Altman Z Score data for Amazon.com, Inc., we can gain valuable insights into the company's financial health and stability over the years. The Altman Z Score is a widely-used formula that assesses a company's likelihood of bankruptcy based on various financial ratios. Let's analyze the results of the Altman Z Score for Amazon.com, Inc. from 2014 to 2023.
Below are the Altman Z Score results for Amazon.com, Inc. for each respective year:
Overall, the Altman Z Score for Amazon.com, Inc. has shown a mostly positive trend over the years, indicating a strong financial position and reduced likelihood of bankruptcy. The company's score peaked in 2020 at 6.0955, which signifies a very low probability of insolvency. However, there was a slight dip in the score in 2022 to 2.9367, which may raise some concerns about the company's financial stability.
Overall, based on the Altman Z Score data, Amazon.com, Inc. appears to be in a strong financial position, but it is important for investors and stakeholders to monitor any fluctuations in the score to assess the company's ongoing financial health.
Amazon.com, Inc. is a well-known e-commerce giant that has been dominating the retail market for years. However, it is crucial for investors to analyze the company's financial health to assess the risks and opportunities associated with investing in Amazon.
The Altman Z-Score is a formula that measures a company's financial health and likelihood of bankruptcy. Here are the Altman Z-Score results for Amazon.com, Inc. over the past ten years:
Amazon.com, Inc. has consistently maintained a healthy Altman Z-Score above 3.0, indicating a low risk of bankruptcy over the years. The increasing trend in the Z-Score values from 2014 to 2020 reflects the company's improving financial stability and efficient operation management. However, there was a slight dip in the Z-Score in 2022, which warrants attention from investors.
Investing in Amazon.com, Inc. presents both risks and opportunities for investors:
Overall, investing in Amazon.com, Inc. carries both risks and opportunities. The company's consistent Altman Z-Score above 3.0 signifies a relatively low risk of bankruptcy, but investors should stay vigilant of any fluctuations in the financial metrics. Amazon's continuous focus on growth and innovation position it as a promising investment option for those looking for long-term returns.
