Amazon.com vs Shopify Which Is Stronger?

Amazon.com and Shopify are two eCommerce giants that have seen substantial growth in their stock prices in recent years. Amazon, a dominant force in the online retail market, has a market capitalization of over $1.5 trillion, while Shopify, a leading eCommerce platform for small businesses, has a market cap of around $150 billion. Both companies continue to innovate and expand their offerings, but their stocks have different risk profiles and growth potential, making them appealing to different types of investors.

Amazon.com or Shopify?

When comparing Amazon.com and Shopify, 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 Amazon.com and Shopify.

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. Amazon.com has a dividend yield of -%, while Shopify has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Amazon.com reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Shopify 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 Amazon.com P/E ratio at 44.53 and Shopify's P/E ratio at 110.44. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Amazon.com P/B ratio is 8.57 while Shopify's P/B ratio is 15.33.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Amazon.com has seen a 5-year revenue growth of 1.33%, while Shopify's is 4.42%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Amazon.com's ROE at 21.82% and Shopify's ROE at 14.38%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $210.89 for Amazon.com and $109.00 for Shopify. Over the past year, Amazon.com's prices ranged from $139.52 to $215.90, with a yearly change of 54.74%. Shopify's prices fluctuated between $48.56 and $115.62, with a yearly change of 138.10%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.