Groupon vs Amazon.com Which Is More Promising?

Groupon and Amazon.com are two popular e-commerce companies with distinct business models and approaches to the market. While Amazon.com dominates the online retail space with its vast product offerings and strong brand recognition, Groupon focuses on offering daily deals and discounts to consumers. Both companies have seen fluctuations in their stock prices over the years, with Amazon.com consistently outperforming Groupon in terms of market capitalization and revenue growth. Investors looking to invest in the e-commerce sector must carefully consider the differences between these two companies before making a decision.

Groupon or Amazon.com?

When comparing Groupon 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 Groupon 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. Groupon has a dividend yield of -%, while Amazon.com has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Groupon reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. 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 Groupon P/E ratio at 23.61 and Amazon.com's P/E ratio at 47.90. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Groupon P/B ratio is 11.41 while Amazon.com's P/B ratio is 9.22.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Groupon has seen a 5-year revenue growth of -0.82%, while Amazon.com's is 1.33%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Groupon's ROE at 95.71% 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 $11.21 for Groupon and $225.86 for Amazon.com. Over the past year, Groupon's prices ranged from $7.75 to $19.56, with a yearly change of 152.39%. 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.