AMZN vs. IBM: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at AMZN and IBM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
AMZN’s market capitalization of 2,371.81 billion USD is substantially larger than IBM’s 271.36 billion USD, indicating a significant difference in their market valuations.
AMZN’s beta of 1.33 points to significantly higher volatility compared to IBM (beta: 0.65), suggesting AMZN has greater potential for both gains and losses relative to market movements.
| Symbol | AMZN | IBM |
|---|---|---|
| Company Name | Amazon.com, Inc. | International Business Machines Corporation |
| Country | US | US |
| Sector | Consumer Cyclical | Technology |
| Industry | Specialty Retail | Information Technology Services |
| CEO | Andrew R. Jassy | Arvind Krishna |
| Price | 223.41 USD | 291.97 USD |
| Market Cap | 2,371.81 billion USD | 271.36 billion USD |
| Beta | 1.33 | 0.65 |
| Exchange | NASDAQ | NYSE |
| IPO Date | May 15, 1997 | September 24, 1915 |
| ADR | No | No |
Historical Performance
This chart compares the performance of AMZN and IBM by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period.
Data is adjusted for dividends and splits.
Profitability
Return on Equity
AMZN
24.26%
Specialty Retail Industry
- Max
- 70.52%
- Q3
- 29.03%
- Median
- 10.90%
- Q1
- -7.86%
- Min
- -57.43%
AMZN’s Return on Equity of 24.26% is on par with the norm for the Specialty Retail industry, indicating its profitability relative to shareholder equity is typical for the sector.
IBM
21.32%
Information Technology Services Industry
- Max
- 47.24%
- Q3
- 23.27%
- Median
- 12.85%
- Q1
- 2.22%
- Min
- -26.63%
IBM’s Return on Equity of 21.32% is on par with the norm for the Information Technology Services industry, indicating its profitability relative to shareholder equity is typical for the sector.
Return on Invested Capital
AMZN
13.10%
Specialty Retail Industry
- Max
- 29.46%
- Q3
- 13.75%
- Median
- 8.05%
- Q1
- 0.80%
- Min
- -17.95%
AMZN’s Return on Invested Capital of 13.10% is in line with the norm for the Specialty Retail industry, reflecting a standard level of efficiency in generating profits from its capital base.
IBM
8.48%
Information Technology Services Industry
- Max
- 28.29%
- Q3
- 13.19%
- Median
- 7.24%
- Q1
- 0.23%
- Min
- -18.82%
IBM’s Return on Invested Capital of 8.48% is in line with the norm for the Information Technology Services industry, reflecting a standard level of efficiency in generating profits from its capital base.
Net Profit Margin
AMZN
10.14%
Specialty Retail Industry
- Max
- 19.78%
- Q3
- 8.49%
- Median
- 3.43%
- Q1
- -0.69%
- Min
- -9.88%
A Net Profit Margin of 10.14% places AMZN in the upper quartile for the Specialty Retail industry, signifying strong profitability and more effective cost management than most of its peers.
IBM
8.71%
Information Technology Services Industry
- Max
- 20.47%
- Q3
- 11.62%
- Median
- 5.97%
- Q1
- 1.89%
- Min
- -4.62%
IBM’s Net Profit Margin of 8.71% is aligned with the median group of its peers in the Information Technology Services industry. This indicates its ability to convert revenue into profit is typical for the sector.
Operating Profit Margin
AMZN
11.02%
Specialty Retail Industry
- Max
- 24.47%
- Q3
- 11.10%
- Median
- 5.85%
- Q1
- 0.66%
- Min
- -12.62%
AMZN’s Operating Profit Margin of 11.02% is around the midpoint for the Specialty Retail industry, indicating that its efficiency in managing core business operations is typical for the sector.
IBM
16.36%
Information Technology Services Industry
- Max
- 29.42%
- Q3
- 14.75%
- Median
- 8.92%
- Q1
- 2.62%
- Min
- -11.92%
An Operating Profit Margin of 16.36% places IBM in the upper quartile for the Information Technology Services industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
Profitability at a Glance
| Symbol | AMZN | IBM |
|---|---|---|
| Return on Equity (TTM) | 24.26% | 21.32% |
| Return on Assets (TTM) | 10.25% | 3.76% |
| Return on Invested Capital (TTM) | 13.10% | 8.48% |
| Net Profit Margin (TTM) | 10.14% | 8.71% |
| Operating Profit Margin (TTM) | 11.02% | 16.36% |
| Gross Profit Margin (TTM) | 49.16% | 57.04% |
Financial Strength
Current Ratio
AMZN
1.05
Specialty Retail Industry
- Max
- 3.24
- Q3
- 1.99
- Median
- 1.42
- Q1
- 1.02
- Min
- 0.54
AMZN’s Current Ratio of 1.05 aligns with the median group of the Specialty Retail industry, indicating that its short-term liquidity is in line with its sector peers.
IBM
1.01
Information Technology Services Industry
- Max
- 3.41
- Q3
- 2.37
- Median
- 1.58
- Q1
- 1.20
- Min
- 0.00
IBM’s Current Ratio of 1.01 falls into the lower quartile for the Information Technology Services industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
Debt-to-Equity Ratio
AMZN
0.44
Specialty Retail Industry
- Max
- 2.72
- Q3
- 1.42
- Median
- 0.87
- Q1
- 0.35
- Min
- 0.01
AMZN’s Debt-to-Equity Ratio of 0.44 is typical for the Specialty Retail industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
IBM
2.49
Information Technology Services Industry
- Max
- 2.63
- Q3
- 1.16
- Median
- 0.48
- Q1
- 0.09
- Min
- 0.01
IBM’s leverage is in the upper quartile of the Information Technology Services industry, with a Debt-to-Equity Ratio of 2.49. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
Interest Coverage Ratio
AMZN
31.13
Specialty Retail Industry
- Max
- 37.34
- Q3
- 17.19
- Median
- 4.28
- Q1
- 0.11
- Min
- -23.60
AMZN’s Interest Coverage Ratio of 31.13 is in the upper quartile for the Specialty Retail industry, signifying a strong and healthy capacity to meet its interest payments from operating profits.
IBM
5.92
Information Technology Services Industry
- Max
- 17.52
- Q3
- 10.04
- Median
- 4.66
- Q1
- 0.80
- Min
- -10.50
IBM’s Interest Coverage Ratio of 5.92 is positioned comfortably within the norm for the Information Technology Services industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | AMZN | IBM |
|---|---|---|
| Current Ratio (TTM) | 1.05 | 1.01 |
| Quick Ratio (TTM) | 0.84 | 0.97 |
| Debt-to-Equity Ratio (TTM) | 0.44 | 2.49 |
| Debt-to-Asset Ratio (TTM) | 0.21 | 0.46 |
| Net Debt-to-EBITDA Ratio (TTM) | 0.50 | 4.53 |
| Interest Coverage Ratio (TTM) | 31.13 | 5.92 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for AMZN and IBM. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
AMZN
0.00%
Specialty Retail Industry
- Max
- 5.54%
- Q3
- 1.52%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
AMZN currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
IBM
2.29%
Information Technology Services Industry
- Max
- 16.57%
- Q3
- 1.39%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 2.29%, IBM offers a more attractive income stream than most of its peers in the Information Technology Services industry, signaling a strong commitment to shareholder returns.
Dividend Payout Ratio
AMZN
0.00%
Specialty Retail Industry
- Max
- 177.64%
- Q3
- 9.49%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
AMZN has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
IBM
112.81%
Information Technology Services Industry
- Max
- 112.81%
- Q3
- 20.98%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
IBM’s Dividend Payout Ratio of 112.81% is above 100%. This means the company is paying out more in dividends than it earned, a practice that is often unsustainable and could indicate a risk to future dividend stability.
Dividend at a Glance
| Symbol | AMZN | IBM |
|---|---|---|
| Dividend Yield (TTM) | 0.00% | 2.29% |
| Dividend Payout Ratio (TTM) | 0.00% | 112.81% |
Valuation
Price-to-Earnings Ratio
AMZN
35.92
Specialty Retail Industry
- Max
- 81.45
- Q3
- 42.51
- Median
- 25.40
- Q1
- 12.72
- Min
- 1.88
AMZN’s P/E Ratio of 35.92 is within the middle range for the Specialty Retail industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
IBM
49.51
Information Technology Services Industry
- Max
- 49.12
- Q3
- 36.91
- Median
- 24.84
- Q1
- 15.88
- Min
- 1.55
At 49.51, IBM’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Information Technology Services industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
Forward P/E to Growth Ratio
AMZN
1.72
Specialty Retail Industry
- Max
- 5.90
- Q3
- 2.79
- Median
- 1.76
- Q1
- 0.69
- Min
- 0.00
AMZN’s Forward PEG Ratio of 1.72 is within the middle range of its peers in the Specialty Retail industry. This suggests a reasonable balance between the stock’s price and its expected growth, aligning with sector valuation norms.
IBM
9.51
Information Technology Services Industry
- Max
- 5.35
- Q3
- 3.79
- Median
- 2.23
- Q1
- 1.19
- Min
- 0.03
IBM’s Forward PEG Ratio of 9.51 is exceptionally high for the Information Technology Services industry. This suggests its stock price is very high relative to its expected earnings growth, signaling significant overvaluation risk.
Price-to-Sales Ratio
AMZN
3.65
Specialty Retail Industry
- Max
- 5.26
- Q3
- 2.60
- Median
- 1.29
- Q1
- 0.41
- Min
- 0.06
AMZN’s P/S Ratio of 3.65 is in the upper echelon for the Specialty Retail industry. This means the company is valued richly on its revenue stream compared to its peers, suggesting the stock is priced for a high level of future performance.
IBM
4.32
Information Technology Services Industry
- Max
- 8.15
- Q3
- 4.17
- Median
- 2.14
- Q1
- 1.00
- Min
- 0.10
IBM’s P/S Ratio of 4.32 is in the upper echelon for the Information Technology Services industry. This means the company is valued richly on its revenue stream compared to its peers, suggesting the stock is priced for a high level of future performance.
Price-to-Book Ratio
AMZN
7.74
Specialty Retail Industry
- Max
- 12.73
- Q3
- 6.96
- Median
- 3.28
- Q1
- 1.42
- Min
- 0.24
AMZN’s P/B Ratio of 7.74 is in the upper tier for the Specialty Retail industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.
IBM
10.08
Information Technology Services Industry
- Max
- 11.78
- Q3
- 6.14
- Median
- 3.23
- Q1
- 1.97
- Min
- 0.42
The P/B Ratio is often not a primary valuation metric for the Information Technology Services industry.
Valuation at a Glance
| Symbol | AMZN | IBM |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 35.92 | 49.51 |
| Forward PEG Ratio (TTM) | 1.72 | 9.51 |
| Price-to-Sales Ratio (P/S, TTM) | 3.65 | 4.32 |
| Price-to-Book Ratio (P/B, TTM) | 7.74 | 10.08 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | 113.97 | 22.73 |
| EV-to-EBITDA (TTM) | 18.07 | 26.54 |
| EV-to-Sales (TTM) | 3.75 | 5.21 |