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Is NASDAQ:AMZN on the Verge of a Major Breakout as a Strong Growth Stock?

By Mill Chart

Last update: Apr 17, 2024

In this article we will dive into AMAZON.COM INC (NASDAQ:AMZN) as a possible candidate for growth investing. Investors should always do their own research, but we noticed AMAZON.COM INC showing up in our strong growth, ready to breakout screen, which makes it worth to investigate a bit more.

Understanding NASDAQ:AMZN's Growth Score

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:AMZN was assigned a score of 8 for growth:

  • AMZN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 199.28%, which is quite impressive.
  • Measured over the past years, AMZN shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.57% on average per year.
  • AMZN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.83%.
  • AMZN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 19.80% yearly.
  • AMZN is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 26.10% yearly.
  • Based on estimates for the next years, AMZN will show a quite strong growth in Revenue. The Revenue will grow by 11.49% on average per year.

ChartMill's Evaluation of Health

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:AMZN scores a 5 out of 10:

  • AMZN has an Altman-Z score of 5.14. This indicates that AMZN is financially healthy and has little risk of bankruptcy at the moment.
  • With an excellent Altman-Z score value of 5.14, AMZN belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.
  • AMZN has a debt to FCF ratio of 2.60. This is a good value and a sign of high solvency as AMZN would need 2.60 years to pay back of all of its debts.
  • Looking at the Debt to FCF ratio, with a value of 2.60, AMZN is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
  • AMZN has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.

Profitability Assessment of NASDAQ:AMZN

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:AMZN has earned a 7 out of 10:

  • AMZN has a better Return On Assets (5.76%) than 72.73% of its industry peers.
  • AMZN has a better Return On Equity (15.07%) than 72.73% of its industry peers.
  • With a decent Return On Invested Capital value of 8.23%, AMZN is doing good in the industry, outperforming 69.70% of the companies in the same industry.
  • The 3 year average ROIC (6.24%) for AMZN is below the current ROIC(8.23%), indicating increased profibility in the last year.
  • AMZN's Profit Margin of 5.29% is fine compared to the rest of the industry. AMZN outperforms 69.70% of its industry peers.
  • AMZN's Profit Margin has improved in the last couple of years.
  • With a decent Operating Margin value of 6.41%, AMZN is doing good in the industry, outperforming 69.70% of the companies in the same industry.
  • In the last couple of years the Operating Margin of AMZN has grown nicely.
  • AMZN has a Gross Margin of 46.98%. This is in the better half of the industry: AMZN outperforms 63.64% of its industry peers.
  • In the last couple of years the Gross Margin of AMZN has grown nicely.

Looking at the Setup

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NASDAQ:AMZN this score is currently 7:

AMZN has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately. A pullback is taking place, which may present a nice opportunity for an entry. There is a support zone below the current price at 181.87, a Stop Loss order could be placed below this zone.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

Our latest full fundamental report of AMZN contains the most current fundamental analsysis.

Check the latest full technical report of AMZN for a complete technical analysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.

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AMAZON.COM INC

NASDAQ:AMZN (5/29/2024, 7:00:00 PM)

Premarket: 181 -1.02 (-0.56%)

182.02

-0.13 (-0.07%)

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