Do You Have These Top E-Commerce Stocks On Your Q4 2020 Watchlist?
E-commerce stocks have been some of the biggest winners in the stock market this year. The COIVID-19 pandemic has forced traditional retail stores to close their doors, which harshly impacted the entire retail sector. With more people staying at home, top e-commerce stocks have been the big winners for investors in the market. Since the start of the pandemic, many consumers have had to transition their shopping to all online. For some people, it may have been their first experience shopping for items online. Needless to say, the added convenience of online shopping can present an alternative, which a lot of consumers will likely rely on after the pandemic is over.
That is why the best e-commerce stocks to watch in the stock market today have been steadily increasing their market share for most of this year. E-commerce companies like Shopify (SHOP Stock Report), and JD.com (JD Stock Report) have seen an increase in their share prices of 124.12% and 130.50% year to date, respectively. Many others have seen record highs this year, and we anticipate this trend to continue even in a post-pandemic economy. According to a recent report by eMarketer, the coronavirus pandemic accelerated U.S. online shopping by almost 2 years. As the old saying goes “the trend is your friend”, here are 3 top e-commerce stocks to watch ahead of the holiday season.
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Best E-Commerce Stocks To Buy [Or Avoid] Now: Jumia Technologies
First, on the list, Jumia Technologies (JMIA Stock Report) is an African e-commerce and digital-payments company. In the last 7 days, JMIA stock price has seen an increase of 33.38%. Jumia has caught the attention of investors since early October when the stock price advanced higher by an astounding 87%. The company recently reported its third-quarter earnings, which caused the stock price to drop almost 20%.
Yes, the company’s revenues were not as impressive as some of the other players in the space, but this shouldn’t come as any surprise. That’s because the company has previously announced its intentions to shift its business model to be more of a third-party platform company. The shift from first-party to third-party sales can result in bigger sales numbers for the company. In its most recent earnings report, JMIA’s gross profit increased by 23% year-over-year. They also reported its annual active customers jumped 23% to 6.7 million. The company’s total payment volume for its JumiaPay platform also saw an impressive increase of 50% year-over-year.
“We are making significant progress on our path to profitability with Adjusted EBITDA loss in the third quarter of 2020 decreasing by 50% year-over-year”, stated Jeremy Hodara and Sacha Poignonnec, Co-Chief Executive Officers of Jumia.
If you put into perspective the large population of where Jumia operates, these numbers seem pretty small. So what does this mean? It means that there’s potential for massive untapped growth within the company’s target market. With that being said, do you think JMIA stock can continue its recent momentum as we head into the holiday season?
Best E-Commerce Stocks To Buy [Or Avoid] Now: Alibaba
Next up on this list of top e-commerce stocks to watch in the stock market today is Alibaba (BABA Stock Report). Alibaba has been one of the most consistent performing e-commerce stocks for investors in the market in recent years. BABA stock is currently up 51.01% from March lows. The company has experienced a recent pull-back in its last week of trading activity. This is due to Chinese regulators taking steps to try and prevent top Chinese tech stocks from exhibiting monopolistic behavior. This seems to catch investors off guard judging by the way the stock price fell. Should you be worried about this recent pullback? The answer is I don’t think so.
Alibaba recently announced that is grossed nearly $74 billion during this year’s Double 11 Shopping Festival. The festival took place from November 1st through November 11th. This resulted in 26% growth year-over-year.
“Over the past 12 years, innovation has been at the heart of 11.11 and along the way it became a global consumer festival. 11.11 is defined by our consumers, merchants and our partners across the ecosystem, and also a beneficiary of all the support from society,” commented Jiang Fan, President of Taobao and Tmall.
Despite the increase of regulatory oversight on tech companies. Even though the increase of regulatory oversight, Alibaba still has strong fundamentals and remains a leader in China’s e-commerce. With that being said, is now the best time to buy BABA stock ahead of the busiest shopping time of the year?
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Best E-Commerce Stocks To Buy [Or Avoid] Now: Amazon
Last on the list is e-commerce giant Amazon (AMZN Stock Report) is the largest e-commerce company in the world. Amazon is the leader in the e-commerce segment and cloud computing, while simultaneously having a significant market share in other emerging industries such as video streaming. AMZN stock price is currently up 67.23% year-to-date closing Tuesday’s trading session at $3135.66 a share. Today the company announced the introduction of Amazon Pharmacy. This new store will help customers purchase prescription medications from the comfort of their own homes.
“We designed Amazon Pharmacy to put customers first – bringing Amazon’s customer obsession to an industry that can be inconvenient and confusing,” said TJ Parker, Vice President, Amazon Pharmacy. He continued with, “We work hard behind the scenes to handle complications seamlessly so anyone who needs a prescription can understand their options, place their order for the lowest available price, and have their medication delivered quickly,” stated Doug Herrington, Senior Vice President of North American Consumer at Amazon.
I believe this will be a great compliment to the companies PillPack service. If you think about it, Amazon’s success is tied into two huge megatrends, e-commerce and cloud computing services. For those reasons, AMZN stock is at the top of our list of e-commerce stocks to watch this holiday season.