Alphabet vs Amazon.com Which Is More Lucrative?

When comparing Alphabet Inc. and Amazon.com Inc. stocks, investors are presented with two tech giants that have had significant impacts on their respective industries. Alphabet, the parent company of Google, dominates the search engine market and leads in online advertising, while Amazon is the e-commerce leader with a growing presence in various other sectors. Both companies have seen impressive growth in recent years, but each also faces unique challenges and opportunities that may affect their stock performance in the future.

Alphabet or Amazon.com?

When comparing Alphabet and Amazon.com, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Alphabet and Amazon.com.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Alphabet has a dividend yield of 0.31%, while Amazon.com has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Alphabet reports a 5-year dividend growth of 0.00% year and a payout ratio of 5.22%. On the other hand, Amazon.com reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Alphabet P/E ratio at 25.03 and Amazon.com's P/E ratio at 48.22. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Alphabet P/B ratio is 7.51 while Amazon.com's P/B ratio is 9.28.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Alphabet has seen a 5-year revenue growth of 1.47%, while Amazon.com's is 1.33%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Alphabet's ROE at 31.66% and Amazon.com's ROE at 21.82%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $193.29 for Alphabet and $227.63 for Amazon.com. Over the past year, Alphabet's prices ranged from $131.06 to $196.89, with a yearly change of 50.23%. Amazon.com's prices fluctuated between $144.05 and $231.20, with a yearly change of 60.50%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.