Question

Does Amazon issue bonds? If so, what are the characteristics of these bonds and do you feel that they borrow too much, too little or just about right? Why?

Answer 1

Yes. Amazon issues bonds. They have currently $ 24.8 Billion of debt on their 2019 Balancesheet. The details of the debt notes are as follows in the image:

Now Lets see the income statement of the Company

The Company has more than $ 11.63 Billion in Comprehensive income thus the total liability is about 2.14 times the yearly income of the Company. Thus the Debt feels on an average but to make sure we should see if there's cash and cash equivalent on the Balance Sheet.

The Characteristics of the debt is plain debt thus only bearing they have is the interest payment to the holders. The Fair value of the notes is higher than the current balancesheet figures.

Lets see the Cash and Cash Equivalents in the Balance Sheet :

The Fair Value of Cash and Cash Equivalent is $ 55.02 Billion which is higher than the total debt notes issued by Amazon thus, effectively Amazon is Debt free. As we know the Amazon Web Services business of Amazon is the cash generating business while E-commerce business is still in growing mode so the debt seems to be in too little category.