Title: Can Amazon Keep Growing? How Dr Tagline: Can Amazon Keep Growing? How Dr. Anya Sharma Uses the Retention Ratio to Decide if AMZN is a Good Buy Problem: Dr. Anya Sharma, a busy physician, wants to invest in growth stocks to supplement her retirement savings, but also needs income to aggressively pay down her $280,000 student loan debt. She's eyeing Amazon (AMZN) but wonders if the company is still prioritizing growth or shifting towards returning capital to shareholders, and whether that growth justifies the risk of investing in a non-dividend paying stock. How can she determine if Amazon is truly a growth stock deserving of her investment, given her specific financial goals? Solution: Dr. Sharma can use the Retention Ratio Calculator to analyze Amazon's reinvestment strategy. By inputting Amazon's earnings per share (EPS) and dividends per share (if any) from their financial statements, she can determine the percentage of earnings being retained. A high retention ratio suggests the company is prioritizing growth through reinvestment, which is beneficial if Dr. Sharma is looking for long-term capital appreciation. She can then compare the retention ratio over several years to identify trends and assess the consistency of Amazon's growth strategy. Further, by comparing the trend of the retention ratio to debt-to-asset ratio and times-interest-earned ratio, she can infer the relationship between reinvestment and debt burden. This will lead to an informed decision on the stability of Amazon's growth for a risk averse investor. ROI: By understanding Amazon's retention ratio, Dr. Sharma can make a more informed investment decision. If the calculator reveals a high and consistent retention ratio (e.g., above 70%), it suggests that Amazon is aggressively reinvesting for future growth, potentially leading to higher capital appreciation. If the ratio is declining or significantly lower, it may indicate a shift towards returning capital to shareholders or a slowdown in growth opportunities. This knowledge helps Dr. Sharma estimate potential returns and manage risk, potentially resulting in an extra $5,000 to $10,000 in portfolio value over 5 years, or deciding to invest elsewhere and save on potential losses. Description: Is Amazon still a growth stock? Use our retention ratio calculator to analyze Amazon's potential for future expansion and see if it aligns with your investment goals. This simple tool helps you determine how much of Amazon's earnings are being reinvested for future growth, critical for long-term investing. Category: Lead Gen