AMZN vs. NFLX: A Head-to-Head Stock Comparison

Company Overview

AMZN’s market capitalization of 2,303.55 billion USD is substantially larger than NFLX’s 521.09 billion USD, indicating a significant difference in their market valuations.

With betas of 1.33 for AMZN and 1.59 for NFLX, both stocks show similar sensitivity to overall market movements.

Performance Comparison

This chart compares the performance of AMZN and NFLX over the past year by tracking the growth of an initial $10,000 investment in each (starting one year ago).

Data is adjusted for dividends and splits.

Valuation Metrics Comparison

This section compares the market valuation of AMZN and NFLX. Key takeaways regarding their valuation, when viewed within their industry context, are presented in the commentary that follows.

• NFLX’s Price-to-Earnings (P/E) ratio of 56.44 is very high. This signifies that its stock is trading at a premium, likely reflecting market optimism about its future growth, though it also implies a higher risk if these growth expectations are not met.
• NFLX’s Forward PEG ratio of 3.26 is very high. This signifies that its current stock price is notably elevated compared to its anticipated earnings growth rate, possibly indicating that the market has already factored in, or even exceeded, realistic future performance expectations.
• AMZN’s Price-to-Book (P/B) ratio of 7.52 and NFLX’s P/B ratio of 21.77 are both very high. For AMZN, this typically means the market assigns a much greater value to the company than its net accounting worth, often due to factors like robust intangible assets or superior growth prospects. NFLX’s high P/B also suggests investors have high expectations for its future performance and are pricing it well above its book value.

Dividend Comparison

Neither AMZN nor NFLX currently pays a dividend; this often suggests they are reinvesting earnings for growth, prioritizing long-term expansion over immediate cash returns to shareholders.

Financial Strength Metrics Comparison

This section evaluates the financial strength of AMZN and NFLX. Noteworthy observations on their financial resilience, considered from an industry perspective, are detailed in the points that follow.

• AMZN’s current ratio of 1.05 is considered low. This may signal potential challenges with its short-term liquidity, implying that its current assets might offer a limited buffer for meeting its immediate debts and could affect its capacity to smoothly manage upcoming financial duties.