Amazon (AMZN)

Definition

Amazon (AMZN) is a multinational technology company focusing on e-commerce, cloud computing, digital streaming, and artificial intelligence. It is publicly traded on the NASDAQ stock exchange under the ticker symbol AMZN.

5 Must Know Facts For Your Next Test

1. Amazon's market value ratios include its Price-to-Earnings (P/E) ratio, which is often compared with industry peers to assess valuation.
2. Amazon's high market capitalization makes it one of the most valuable companies globally and significantly affects market indices like the S&P 500.
3. The company's Price-to-Sales (P/S) ratio helps investors evaluate how much they are paying for each dollar of Amazon’s sales.
4. Amazon's Earnings Per Share (EPS) growth rate is a critical indicator used by analysts to project future profitability and performance.
5. The company's Return on Equity (ROE) measures its ability to generate profits from shareholders' equity, providing insight into management efficiency.

Review Questions

• What does Amazon's P/E ratio indicate about its valuation compared to its competitors?
• How does Amazon's market capitalization influence major stock indices?
• Why is Amazon's EPS growth rate important for financial analysts?

Related terms

Price-to-Earnings Ratio (P/E): A measure of a company's current share price relative to its per-share earnings.

Market Capitalization: The total value of a company’s outstanding shares of stock at current market prices.

Return on Equity (ROE): A measure of financial performance calculated by dividing net income by shareholders' equity.