Should You Keep Your Focus On These Top E-Commerce Stocks?
At the height of the coronavirus pandemic, most e-commerce stocks reaped exponential growth as lockdowns encouraged customers to engage more in online purchases. As we slowly shift to a post-pandemic recovery phase, some investors have rebalanced their portfolio onto reopening stocks. This has certainly shifted perceptions around e-commerce stocks. After all, it is reasonable to ponder upon future growth rates after the pandemic.
This week, we saw South Korean e-commerce giant Coupang (NYSE: CPNG) surged 40% in its market debut Thursday on the New York Stock Exchange. The company had priced its shares at $35 a share, above its target range of $32 to $34. Following the huge demand for its shares, CPNG stock began trading at $63.5 per share. That signaled confidence among investors in the company, and the e-commerce sector in general.
Now, the $1.9 trillion COVID stimulus package has received approval from Congress. It’s safe to assume that top e-commerce stocks are likely to benefit from the cash injection. The new round of stimulus checks could potentially drive consumers to splurge on discretionary items on e-commerce platforms. If you believe the stay-at-home economy is here to stay, do you have a list of the best e-commerce stocks to buy this month?
Best E-Commerce Stocks To Buy [Or Sell] In March 2021
- JD.com Inc. (NASDAQ: JD)
- Shopify Inc. (NYSE: SHOP)
- Etsy Inc. (NASDAQ: ETSY)
- Amazon.com Inc. (NASDAQ: AMZN)
JD.com Inc. (JD)
JD.com Inc. is one of the few companies that live through a rags-to-riches fairy tale. Started out as a single unit store in Beijing’s electronic bazaar, today it has evolved into one of the e-commerce giants in China and giving Alibaba Group (NYSE: BABA) a run for its money. The company recently released its financial statements for Q4 2020, Revenue came in 31% higher from a year ago to $34.4 billion. “During this quarter, JD continued its strategic transformation into a supply chain-based technology and service company with increasingly diversified sources of revenues,” said Chief Executive Richard Liu.
Looking to consolidate its capability as a worthy competitor to Alibaba, JD has also secured strategic partnerships with other technology giants like Walmart (NYSE: WMT), Alphabet (NASDAQ: GOOGL), and Tencent Holdings (OTCMKTS: TCEHY). In order to reduce operation costs, JD acquired Kuayue-Express, a delivery service provider. Such move will accelerate the future growth of JD’s logistic business unit, where not only it improves its supply chain operation but also implement cloud-based data analytics.
Despite sliding nearly 15% from its all-time high from its level in February, it’s important to note that JD’s growth story remains intact. It’s important to note that the company’s revenue grew respectably even after China recovered from the pandemic. This suggests that the online boom may be here to stay. Considering all these, do you think JD stock is enticing enough for investors?
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Shopify Inc. (SHOP)
Shopify Inc. provides tools for businesses to manage their online presence. Its platform and services focus on delivering a better shopping experience for consumers. Like many tech stocks, SHOP stock has fallen by over 20% since the peak in mid-February. With SHOP stock rising 5% on Thursday, could investors finally be breathing a sigh of relief?
Shopify has been able to gain huge traction during the pandemic crisis. Total revenue in the fourth quarter of 2020 was $977.7 million. That’s a 94% increase from the same quarter a year ago. Gross merchandise volume also saw a similar increase, nearly doubling to $41.1 billion.
Considering Shopify’s strong performance, many would be curious as to how such growth rates can continue going forward. Chances are, a good portion of merchants signing up on the platform will stick around. That could be because of the growing appreciation of the need for an online presence to stay in business. Therefore, do you think SHOP stock has a long growth runway ahead?
Etsy Inc. (ETSY)
Looks like Etsy Inc. has caught a spark as the specialty e-commerce company rose 7% on Thursday. One of the top performers in the S&P 500 in 2020, ETSY stock nearly quadrupled in 2020. The question is, can ETSY stock continue its stellar run for the rest of 2021?
One of the major factors that drove Etsy’s remarkable growth is its positioning in a niche market. Once touted as a platform to get customized or indie arts and crafts, a surge in retrenched employees during the pandemic opened up an opportunity for new sellers to market their product on Etsy’s platform, driving active sellers and users up. The transition of physical purchases to online platforms is also driven Etsy’s revenue up, increasing its market value.
It will be an interesting time for Etsy once lockdowns are withdrawn and the vaccination program in the country is in full effect. With plenty of excess cash at its disposal, Etsy has no shortage of resources to maintain its user retention. With that in mind, would you add ETSY stock to your watchlist?
Amazon.com Inc. (AMZN)
E-commerce giant Amazon needs no introduction. With AMZN stock trading sideways for the past few months, one may wonder if it has plateaued. But the e-commerce stock has demonstrated a history of compounding over many years. With Amazon’s history of innovation, you can bet that there are always new tricks up its sleeves.
In preparation for the post-recovery environment, Amazon has quietly begun to build its grocery chain throughout the country. With outlet No. 11 opened on Tuesday, Amazon is looking to open at least 28 more around Philadelphia and Sacramento outlets. Even more interesting is that the company is rolling out testing phases for a cashier-less transaction in selected outlets.
Despite its scale, it is 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 gotten stronger than ever, Considering the weakness in AMZN stock since early February, would it be a good opportunity for investors to buy on the dip?