Top E-Commerce Stocks Making Big Moves This Week
E-commerce stocks have been among the market’s most resilient and best-performing stocks this year. When investors think of e-commerce, the undisputed leader Amazon (AMZN Stock Report) sure is the first thing that comes to investors’ minds. The pandemic has accelerated the adoption of online purchases and has helped Amazon stock climb more than 75% this year. Not too shabby for nine month’s worth of investing, considering its massive size. But if you’d invested during the coronavirus induced stock market crash in March, you would have doubled your investment.
The ProShares Online Retail ETF (ONLN Stock Report), which has 26 different e-commerce companies in its portfolio, handsomely outperformed the broader S&P 500 index. That tells you just how much optimism there is in this sector. Most top e-commerce stocks have made full recovery. Many are even trading higher than their pre-pandemic levels. Now that we are in the summertime, there is a trend toward more self-indulgent shopping. And that might potentially include more impulse buys. That will ultimately translate to higher traffic in the e-commerce marketplace. With all that in mind, should investors include these top e-commerce stocks on their watchlist before the next quarter?
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Top E-Commerce Stocks To Buy Right Now [Or Avoid]: Shopify
First, up the list, Shopify (SHOP Stock Report) has been one of the biggest beneficiaries during the pandemic. It’s been a wild ride for SHOP stock since the stock has climbed more than 150% year-to-date. The company is well-positioned to help many companies move their businesses online in order to stay in business during the pandemic.
The most recent quarterly result has certainly not disappointed investors. Of course, unprecedented growth isn’t sustainable. But, the company has created a new avenue for business owners to be more proactive in their sales strategy.
And because of that, there’s a great chance merchant who created their online stores are likely to maintain their digital presence even after the pandemic has run its course.
Top E-Commerce Stocks To Buy Right Now [Or Avoid]: BigCommerce Holdings
With success from Shopify, there comes competition. BigCommerce (BIGC Stock Report) is another top e-commerce stock to watch in the long run. The newly listed e-commerce stock spiked more than 37% during intraday trading on Tuesday and continued their rally in the pre-market trading. This came after the company announced that its e-commerce checkout services would be available through Facebook’s (FB Stock Report) Instagram app. This integration allows consumers to check out on Instagram. Of course, this is way more convenient than leaving the app to open a merchant’s website. With this service, merchants could sell their products through Instagram more easily.
Now, before we conclude that this is the next Shopify, it’s worth considering the size of BigCommerce which is way smaller than Shopify. We can see the difference not just in terms of market capitalization. Shopify is reportedly to be at least 15 times bigger in terms of their client base. Looking at the annual recurring revenue (ARR) alone, Shopify is still head and shoulders above BigCommerce.
Of course, this will be a growth stock worth watching especially when there’s bullish sentiment among e-commerce companies. Investors will need to pay attention to the company’s future performance. That will inform if the new partnership with Instagram is able to boost BigCommerce’s top and bottom lines.
Top E-Commerce Stocks To Buy Right Now [Or Avoid]: SAP
Yes, I know. SAP (SAP Stock Report) may not be an e-commerce stock, but it is the engine behind many e-commerce operations. The company’s SAP commerce cloud solutions ease customers’ purchasing process by helping to deliver a seamless experience. Just last month, SAP stock soared upon the announcement of Qualtrics spin-off.
Following the broader tech stocks sentiment, SAP stock is now trading higher than its pre-pandemic level. Shares of SAP have climbed more than 20% year to date. However, if you bought them during March, you would have reaped around 80% profit by now. The rising enterprise cloud sector coupled with the spin-off headlines are sending SAP stock higher.
The increasing importance of cloud computing businesses could further power SAP stock higher if your investment horizon is long enough. That said, would you invest in SAP stock today?