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amazon.com ratio analysis

ratio analysis of amazon.com 2014,2015,2016

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amazon.com ratio analysis

  1. 1. TEAM MEMBERS MANOHAR REDDY.E G.V.S.N.N.VARMA MANOJ REDDY KRISHNA KANTH RAHUL KRISHNA
  2. 2. CONTENT INTRODUCTION COMPETITORS SWOT ANALYSIS STOCK MARKET FINANCIAL STATEMENT RATIO ANALYSIS
  3. 3. INTRODUCTION
  4. 4. Amazon.com, Inc., often referred to as simply Amazon, is an American electronic commerce and cloud computing company with headquarters in Washington. It is the largest Internet-based retailer in the world by total sales and market capitalization. Amazon.com started as an online bookstore, later diversify to sell other items Amazon also sells certain low-end products like USB cables under its in-house brand AmazonBasics. Amazon has separate retail websites for the United States, the United Kingdom and Ireland, France, Canada, Germany, Italy, Spain, Netherlands, Australia, Brazil, Japan, China, India and Mexico. 18th rank in fortune
  5. 5. COMPETITORS
  6. 6.  Amazon has several competitors in the electronics and general merchandise segment, many of which are brick and motar rivals including Best Buy, Family Dollar, RadioShack, Staples, Target, Walmart, Sears, Big Lots, Delia and Systemacs.  In the electronics and general merchandise segment online competition includes Alibaba Group, LightInTheBox Holding Co., Overstock.com, PCM, Vipshop Holdings, JD.com, Wayfair Inc. and Zulily.
  7. 7.  In the media segment, Amazon competes with auction site eBay (EBAY); media game-changer Netflix (NFLX); Time Warner Cable (TWX); Apple (AAPL), with iTunes; Google (GOOG) with its Play Store; and media producer Liberty Interactive (QVCB).  In the other operating segment, Amazon competes with several of the world's largest companies including CDW, PC Connection, Insight Enterprises, Google, Oracle; salesforce.com, Accenture and Citrix Systems, among others
  8. 8. KEY PERSONS Jeff Bezos (Chairman, President and CEO) Werner Vogels (CTO)
  9. 9. SWOT ANALYSIS
  10. 10. Strength: 1st mover advantage strong customer connect Weakness: Product flops. Opportunities: growth of E- Commerce. Global Expansion. Threats: Government regulations. Local competition. Brick and motars
  11. 11. STOCK MARKET
  12. 12. Stock market graph from 1995 to present
  13. 13. FINANCIAL STATEMENTS *Amounts In Millions of USD
  14. 14. Income Statement 2015 2014 2013 Revenue 107,006 88,988 74,452 cost of revenue 71,651 62,752 54,181 Gross profit 35,355 26,236 20,271 total operating expenses 33,122 26,056 20,157 Operating income 2,233 178 745 Other, net -256 -118 - Income before tax 1,568 -111 506 Income after tax 618 -278 345 Equity in affiliates -22 37 -71 Net Income before extra. Items 596 -241 274 Net income 596 -241 274 Diluted weighted average shares 477 462 465 Diluted EPS excluding extraordinary items 1.25 -0.52 0.59 Diluted Nomalized EPS 1.25 -0.52 0.59
  15. 15. Balance Sheet 2015 2014 2013 Current assets 35,705 31,327 24,625 Fixed assets - - - Total Assets 64,747 54,505 40,159 Current Liabilities 33,887 28,089 22,980 Long Term debts 8,227 12,489 5,181 Other liabilities 9,249 2,165 2,252
  16. 16. RATIO ANALYSIS Is a method or process by which the relationship of items or groups of items in the financial statements are computed, and presented. Is an important tool of financial analysis. Ratios can be broadly classified into four groups namely:  Liquidity ratios  Capital structure/leverage ratios  Profitability ratios  Activity ratios
  17. 17. LIQUDITY RATIO These ratios analyse the short-term financial position of a firm and indicate the ability of the firm to meet its short-term commitments.  Current ratio  Quick Ratio/Liquid Ratio/Acid Test Ratio  Absolute Liquid Ratio
  18. 18. Year Current asset Current liabilities Ratio 2015 35,705 33,887 1.0536 2014 31,327 28,089 1.1152 2013 24,625 22,980 1.0715 CURRENT RATIO: Current Ratio Formula = Current Assets / Current Liabilities The ideal ratio is 2. By above we can observe that the company current ratio is poor.
  19. 19. Year Quick Assets Current Liabilities Ratios 2015 25,462 33,887 0.751 2014 23,028 28,089 0.819 2013 17,214 22,980 0.749 Quick Ratio/Liquid Ratio/Acid Test Ratio: Quick Ratio Formula = (Cash and Cash Equivalents + Accounts . . Receivables)/Current Liabilities
  20. 20. Year Absolute Liquid Current Liabilities Ratio 2015 19,808 33,887 0.5845 2014 17,416 28,089 0.620 2013 12,447 22,980 0.541 Absolute Liquid Ratio: Cash Ratio Formula = Cash & Cash equivalents / Current Liabilities
  21. 21. ACTIVTY / TURNOVER RATIO These ratios are also called efficiency ratios / asset utilization ratios or turnover ratios. These ratios show the relationship between sales and various assets of a firm.  Asset turnover ratio  Working capital turnover ratio  Inventory turnover ratio  Debtors turnover ratio  Creditors turnover ratio
  22. 22. Year Cost of Goods Sold Average Stock Ratio 2015 71,651 10,243 6.99 2014 62,752 8,299 7.56 2013 54,181 7,411 7.31 Stock/Inventory Turnover Ratio: Stock turnover ratio=cost of goods sold/average inventory
  23. 23. Year Net Credit Sales Average Receivable Ratio 2015 107,006 5633 18.96 2014 88,988 5196 17.146 2013 74,452 4292 17.34 Year Days Debtor turnover ratio 2015 365 18.96 19.25 2014 365 17.14 21.28 2013 365 17.34 21.04 Debtors/Receivable Turnover Ratio: Debtor velocity/average collection period:
  24. 24. Year Current purchases Average creditors Ratio 2015 71,651 20,397 3.512 2014 62,752 16,459 3.812 2013 54,181 15,133 3.580 Year Days Creditor turnover ratio 2015 365 3.512 103.92 2014 365 3.812 95.75 2013 365 3.580 101.955 Creditor/Payable Turnover Ratio: Creditor velocity/average collection period:
  25. 25. Year Sales Average working capital Ratio 2015 1,07,006 1818 58.859 2014 88,988 3238 27.48 2013 74,452 1645 45.25 Working capital Turnover Ratio:
  26. 26. Year Sales Average current assets Ratio 2015 107506 33,516 3.192 2014 88,988 27,976 3.180 2013 74,452 22,959 3.242 Current Asset Turnover Ratio:
  27. 27. PROFITABILITY RATIO These ratios measure the operating efficiency of the firm and its to ensure adequate returns to its shareholders.  Gross profit ratio  Net profit ratio  Operating ratio  Return on capital employed  Return on assets  Earnings per share
  28. 28. Year Gross profit Sales Ratio 2015 35,355 1,07,006 33.04 2014 26,236 88,988 29.48 2013 20,157 74,452 27.07 Gross Profit Ratio:
  29. 29. Year Net profit Sales Ratio 2015 596 107006 0.55 2014 -241 88,988 -0.27 2013 274 74,452 0.36 Net profit Ratio:
  30. 30. Year Operating expenses Sales Ratio 2015 1,04,773 1,07,006 97.9 2014 88,810 88,988 99.79 2013 73,707 74,452 98.99 Operating expenses ratio:
  31. 31. Year Operating profit Sales Ratio 2015 2233 107006 2.086 2014 178 88988 0.200 2013 745 74452 1.0006 Operating profit ratio:
  32. 32. Year Cost of goods sold Sales Ratio 2015 71,651 107,006 66.95 2014 88,810 88,988 70.51 2013 73,707 74,452 72.79 Cost of goods sold ratio:
  33. 33. Year Cost of goods sold Operating expenses Sales Ratio 2015 71,651 1,04,773 1,07,006 164.87 2014 62,752 88,810 88,988 170.31 2013 54,181 73,707 74,452 73.50 Operating Ratio:
  34. 34. Year Profit before interest&tax Average capital employed Ratio 2015 1568 6475 24.21 2014 -111 54505 2013 506 40155 1.255 Return on capital employed:
  35. 35. Year Earnings after tax Equity Ratio 2015 618 13384 0.046 2014 -278 10741 -0.025 2013 345 9746 0.035 Return on share holder equity:
  36. 36. Year Earnings before interest&tax Total assets Ratio 2015 1568 64747 0.0242 2014 -111 54505 -0.0020 2013 506 40159 0.0125 Return on Assets:
  37. 37. Year Earnings after tax No.of equity shares EPS 2015 618 471 1.31 2014 -278 465 -0.39 2013 345 459 0.75 Earnings per share: *there is no information about preference dividend
  38. 38. Reference https://en.wikipedia.org/wiki/Amazon.com https://www.google.com/finance?q=NASDAQ%3AAMZN& stype=ii&ei=UPLoV_lVz5nQBKq8sJAI
  39. 39. THANK YOU

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