Tesla is in better shape than Amazon on Wall Street

There are no competitions between billionaires, this could lead to an ego match between Elon Musk and Jeff Bezos which would not be of much interest. Nevertheless, we would like to share with you some valuable points that relate to the stock performance of Tesla stock and Amazon stock. This document was prepared with the help of a friend Twittos Mathias Fonsan investor who regularly shares data on Tesla stock.

Introduction

In this article, we will compare the two tech giants on different criteria:

• Market valuation and execution

• Growth in net income

• Revenue growth

• Margins

Market valuation and execution

  • Tesla and Amazon are the only publicly traded companies with a valuation above $350 billion and a P/E ratio above 35.
  • Amazon stock has missed Wall Street analysts’ expectations for quarterly earnings twice in the past 12 months.
  • Tesla stock beat earnings forecasts every quarter of the past year.

Net income growth

A high P/E ratio is often associated with a company whose revenue and (especially) net income are growing faster than those of its peers.

Tesla has increased its profits by 103% in the past 12 months, while those of Amazon have decreased by -9%…

📊: Q3 YOY Net Income Growth

Revenue growth

Amazon’s profits have shrunk despite a 15% increase in revenue last year.

Tesla’s profits doubled as its revenue grew 56% – a classic example of economies of scale, manufacturing efficiencies and breakthroughs…

📊: Q3 Y/Y Revenue Growth

Margins

Tesla’s operating efficiency is demonstrated by the narrowing of the gap between its operating margins and gross margins – helped by Tesla’s operating margin expansion (red line) – while Amazon’s operating margin has gradually declined since the first quarter of 21…

📊: Operating/gross margins — @FinChartco

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