Amazon.com, Inc. (AMZN): investment thesis checklist
What a value investor writing down why they own Amazon.com, Inc. would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 13.0% in FY2025; between 2.3% and 16.7% over 7 filed years, median 11.7%. Does the thesis need it to stay inside that range?
- Return on equity: 18.9% in FY2025; between -1.9% and 24.1% over 10 filed years, median 18.8%. Does the thesis need it to stay inside that range?
- Free cash flow yield: 0.3% in FY2025; between -2.0% and 2.9% over 10 filed years, median 1.5%. Does the thesis need it to stay inside that range?
- EV to EBIT: 32.29x in FY2025; between 32.29x and 78.23x over 7 filed years, median 66.90x. Does the thesis need it to stay inside that range?
- Price to earnings: 32.19x in FY2025; between 32.19x and 190.15x over 9 filed years, median 74.58x. Does the thesis need it to stay inside that range?
- Gross margin: 50.3% in FY2025; between 35.1% and 50.3% over 10 filed years, median 41.5%. Does the thesis need it to stay inside that range?
- Operating margin: 11.2% in FY2025; between 2.3% and 11.2% over 10 filed years, median 5.3%. Does the thesis need it to stay inside that range?
- Net debt to EBITDA: 0.57x in FY2025; between 0.57x and 1.89x over 7 filed years, median 1.14x. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 13.2% in FY2025; between 13.2% and 29.3% over 10 filed years, median 23.7%. Does the thesis need it to stay inside that range?
- Share count change: 1.0% in FY2025; between -1.0% and 3.0% over 9 filed years, median 1.2%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from Amazon.com, Inc.'s own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Debt to Equity stays at or below 0.51x
Today 0.41x. Replayed over 7 filed years, it would have broken in 6; most recently FY2024, at 0.52x (10-K, filed 2025-02-07).
Revenue Growth 1Y stays at or above 0%
Today 12.38%. Replayed over 9 filed years, it held in every one.
Return on Invested Capital stays at or above 10.4%
Today 13%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which debt to equity rose above 0.51x.
- A filed year in which revenue growth 1y fell below 0%.
- A filed year in which return on invested capital fell below 10.4%.
4. The published tests it meets today
Of 30 tests value investors published: 3 met, 26 not met, 1 we could not complete. Counts, never a score.
Meets: High returns and growth; Gross margin, turnover (Robert Novy-Marx); ROIC at or above WACC.
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
No card. 30 free days, and nothing is charged unless you choose a plan.
How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.