Should You Focus On These Top Ecommerce Stocks?
At the height of the coronavirus pandemic, most ecommerce stocks grew exponentially as lockdowns encouraged customers to make more online purchases. As we slowly move into a post-pandemic recovery, some investors have switched their portfolios to reopening stocks. This has certainly changed the perception of ecommerce stocks. Finally, it makes sense to think about future post-pandemic growth rates.
This week we saw South Korean e-commerce giant Coupang (NYSE: CPNG) gain 40% on its market debut on Thursday on the New York Stock Exchange. The company had valued its shares at $ 35 per share, which was above its target range of $ 32 to $ 34. Due to the huge demand for its shares, CPNG stock started trading at $ 63.5 per share. That signaled investor confidence in the company and the e-commerce sector in general.
Now the $ 1.9 trillion COVID stimulus package has been approved by Congress. Expect top ecommerce stocks to likely benefit from the cash injection. The new round of stimulus checks could potentially lead consumers to splurge on discretionary items on e-commerce platforms. If you believe the stay-at-home economy will stay here, do you have a list of the best ecommerce stocks to buy this month?
Best Ecommerce Stocks To Buy [Or Sell] In March 2021
JD.com Inc. is one of the few companies to go through a rags-to-riches fairy tale. Starting as a single store in Beijing’s electronic bazaar, it has now grown into one of the e-commerce giants in China, letting the Alibaba Group (NYSE: BABA) fight for their money. The company recently released its annual financial statements for the fourth quarter of 2020. Revenue increased 31% year over year to $ 34.4 billion. “During the quarter, JD continued its strategic transformation into a supply chain-based technology and services company with increasingly diversified revenue streams.“Said CEO Richard Liu.
To cement its skills as a worthy competitor to Alibaba, JD has also entered into strategic partnerships with other technology giants such as Walmart (NYSE: WMT), Alphabet (NASDAQ: GoogL), and Tencent Holdings (OTCMKTS: TCEHY). To reduce operating costs, JD acquired Kuayue-Express, a delivery service provider. Such a move will accelerate the future growth of JD’s logistics business unit, where they not only improve their supply chain operations but also implement cloud-based data analytics.
Source: TD Ameritrade TOS
Despite falling nearly 15% from its all-time high from February’s level, it’s important to note that JD’s growth story remains intact. It is important to note that the company’s sales have grown significantly even after China has recovered from the pandemic. This suggests that the online boom may continue. With all of this in mind, do you think JD stock is tempting enough for investors?
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Shopify Inc. (SHOP)
Shopify Inc. provides tools for businesses to manage their online presence. The platform and services focus on delivering a better shopping experience for consumers. Like many tech stocks, SHOP stock has fallen over 20% since peaking in mid-February. Could investors finally breathe a sigh of relief with SHOP shares rising 5% on Thursday?
Shopify gained tremendous momentum during the pandemic crisis. Total revenue for the fourth quarter of 2020 was $ 977.7 million. That is 94% more than in the same quarter of the previous year. Gross merchandise volume also saw a similar increase, nearly doubling to $ 41.1 billion.
Source: TD Ameritrade TOS
Given Shopify’s strong performance, many would be curious to see how such growth rates could continue in the future. Chances are that a good portion of the traders who sign up on the platform will stay nearby. This could be due to the growing importance of having an online presence to stay in business. Do you therefore believe that the SHOP share has a long growth path ahead of it?
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Etsy Inc. (ETSY)
It looks like Etsy Inc. sparked a spark as the specialty e-commerce company rose 7% on Thursday. As one of the top performers in the S&P 500 in 2020, ETSY shares almost quadrupled in 2020. The question is, can ETSY stock continue its stellar run for the remainder of 2021?
One of the main reasons for Etsy’s remarkable growth is its positioning in a niche market. Once touted as a platform for individual or independent crafts, a surge in laid-off workers during the pandemic opened up the opportunity for new sellers to market their products on Etsy’s platform, stimulating active sellers and users. Moving from physical purchases to online platforms is also increasing Etsy sales and increasing its market value.
Source: TD Ameritrade TOS
It will be an exciting time for Etsy when the locks are lifted and the vaccination program in the country is in full effect. With plenty of excess cash on hand, Etsy has no shortage of resources to maintain user loyalty. With that in mind, would you add ETSY shares to your watchlist?
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The e-commerce giant Amazon doesn’t need an introduction. Since the AMZN share has moved sideways in the past few months, one can wonder whether it has reached a plateau. But the ecommerce stock has shown a history of compounding for many years. With Amazon’s innovation story, you can bet there are always new tricks up your sleeve.
In preparation for the post-recovery environment, Amazon has quietly begun building its grocery chain across the country. With the opening of outlet # 11 on Tuesday, Amazon plans to open at least 28 more outlets in Philadelphia and Sacramento. What is even more interesting is that the company is introducing test phases for a cashless transaction in selected branches.
Source: TD Ameritrade TOS
Despite its size, it’s easy to forget that Amazon is still growing at a respectable rate. In the fourth quarter of 2020, the company’s net sales rose 44% to $ 125.6 billion. Earnings per share for the quarter more than doubled to $ 14.09. You could say that Amazon’s leadership position has become stronger than ever. Given the weakness of the AMZN share since the beginning of February, would this be a good opportunity for investors to buy in the downturn?
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
