Amazon.com, Inc. (AMZN)vs Meta Platforms, Inc. (META)

Quick verdict

Amazon.com, Inc. (AMZN) and Meta Platforms, Inc. (META) appeal to different investors. On our six-factor framework, AMZN scores 2.5 and META scores 3.5. META looks cheaper on the multiples that matter, while META grows faster and neither clearly earns higher returns on capital. Overall, META edges this comparison, but the right pick depends on whether you prioritise value, growth, income or balance-sheet safety.

2-year relative performance

At-a-glance comparison

Business model and revenue mix

Amazon.com, Inc. operates in Internet Retail (Consumer Cyclical), while Meta Platforms, Inc. sits in Internet Content & Information (Communication Services). The two operate in different sectors, so cyclicality and end-market exposure differ — factor that into any portfolio overlap. AMZN carries a beta of 1.53 versus 1.88 for META, meaning META has historically been the more volatile of the two.

Valuation

On valuation, META is the cheaper stock. AMZN trades on a forward P/E of 45.95 and EV/EBITDA of 32.34, against 42.61 and 34.29 for META. Price-to-sales is 20.74 vs 1.48, and free-cash-flow yield is 2.0% vs 4.9%. A higher multiple is only justified if the company can sustain faster growth or wider margins, which is exactly what the next sections test.

Growth profile

META is the faster grower. AMZN has compounded revenue at 16.9% over three years with EPS growth of 25.7%, while META has delivered 23.5% revenue and 25.6% EPS growth. Growth like this is the single biggest driver of long-term returns, but it also tends to come with a richer valuation, so it must be weighed against the multiples above.

Profitability and quality

On profitability and quality, neither clearly is stronger. AMZN posts a 45.9% operating margin, 26.3% return on equity and 17.3% return on invested capital. META posts 45.0%, 43.8% and 23.9% respectively. Return on invested capital above roughly 15% is a hallmark of a durable competitive advantage, so this metric deserves particular attention.

Balance-sheet risk

AMZN has the safer balance sheet. AMZN carries net-debt/EBITDA of 0.86x with a current ratio of 1.04, versus 2.55x and 2.32 for META. Lower leverage gives a company more room to invest through a downturn and reduces the risk of dilution or distress.

Price performance and shareholder returns

Over the past year AMZN returned 4.0% against 13.9% for META; on a three-year annualised basis it is 42.8% vs 47.4%. AMZN yields 0.0% and META yields 0.0%. Past performance never guarantees future results, but the multi-year track record shows how the market has rewarded each business so far.

Which stock fits which investor

For value-oriented investors, META is the better fit on today's multiples. Growth investors will likely prefer META, which is expanding faster. Income investors should lean toward AMZN for its higher shareholder yield, while investors who prize quality-at-a-reasonable-price will favour META for its superior returns on capital. This is a comparison of facts, not a recommendation — your time horizon, risk tolerance and existing holdings should drive the final decision.

• Value: META
• Growth: META
• Income: AMZN
• Quality: META

Frequently asked questions

Is AMZN or META the better buy right now?

Neither is universally "better." AMZN scores 2.5 and META scores 3.5 on our six-factor framework. META is cheaper, META grows faster, and neither clearly is higher quality — so the right pick depends on your objective.

Which stock is cheaper, AMZN or META?

META is the cheaper stock across forward P/E (45.95 vs 42.61), EV/EBITDA (32.34 vs 34.29) and price-to-sales (20.74 vs 1.48).

Which has grown faster, AMZN or META?

META has the stronger growth profile, with three-year revenue CAGR of 16.9% for AMZN versus 23.5% for META.

Which stock pays a bigger dividend?

AMZN yields 0.0% and META yields 0.0%, so AMZN is the stronger income choice.

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