Amazon.com vs Walmart Which Performs Better?

Amazon.com and Walmart are two of the largest retailers in the world, with each company having a significant presence in the e-commerce industry. Both companies have seen strong growth in their stock prices in recent years, leading to comparisons of their performance in the stock market. Amazon is known for its innovation and dominance in online retail, while Walmart has a long history of success as a traditional brick-and-mortar retailer. Investors often debate which company offers the best investment opportunity for their portfolios.

Amazon.com or Walmart?

When comparing Amazon.com and Walmart, 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 Walmart.

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 Walmart has a dividend yield of 0.88%. 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, Walmart reports a 5-year dividend growth of 1.85% year and a payout ratio of 33.23%.

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 47.90 and Walmart's P/E ratio at 38.50. 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 9.22 while Walmart's P/B ratio is 8.60.

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 Walmart's is 0.34%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Amazon.com's ROE at 21.82% and Walmart's ROE at 23.31%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $225.86 for Amazon.com and $93.04 for Walmart. Over the past year, Amazon.com's prices ranged from $144.05 to $231.20, with a yearly change of 60.50%. Walmart's prices fluctuated between $50.51 and $96.18, with a yearly change of 90.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.