Should Investors Have These Top E-Commerce Stocks On Their Watchlist?
E-commerce stocks have been and continue to be among the top performers in the stock market today. Evidently, a U.S. government report on Wednesday showed that the overall retail sector had a stellar January. Fueled by the $600 stimulus cheques, retail sales were up by a whopping 5.3%. Notably, this figure is more than quadruple the estimate of 1.2% from a Dow Jones survey on the sector. Upon closer inspection, non-store retailer sales (e-commerce sales) surged by 11% in January, marking a solid 28% year-over-year increase. Seeing as this is what $600 a person can do, investors would likely be searching for the best e-commerce stocks to add to their portfolios ahead of the next stimulus package.
Frankly speaking, I wouldn’t blame them for doing so. Take Walmart (NYSE: WMT) for instance. This morning, the world’s largest retailer posted record revenue and sales in its fourth-quarter fiscal. How did it do so? Well, the answer lies in its e-commerce growth throughout the pandemic. Walmart reported a 69% year-over-year surge in its e-commerce sales. Similarly, e-commerce craft supplies seller Etsy (NASDAQ: ETSY) has also been on a tear throughout the pandemic. Its platform contains a plethora of items that continue to keep consumers occupied in their homes. Regardless of whether it is daily necessities or consumer discretionary goods, e-commerce appears to be where the money is at now. With the stage seemingly set, here are four top e-commerce stocks in focus right now.
Best E-Commerce Stocks To Buy [Or Sell] Now
- Amazon.com Inc. (NASDAQ: AMZN)
- Shopify Inc. (NYSE: SHOP)
- GoDaddy Inc. (NYSE: GDDY)
- JD.com Inc. (NASDAQ: JD)
The phrase e-commerce has become near synonymous with our first entry, Amazon. It is common knowledge that the company’s founder, Jeff Bezos, is currently the richest man in the world. How did it get that way? Well, Amazon is one of the largest e-commerce players in the world. Not to mention, it also owns the biggest cloud computing platform in the world, Amazon Web Services. Coupled with a growing streaming platform and various other tech endeavors, Amazon has been busy.
Coming back to e-commerce, the company undoubtedly benefited from pandemic tailwinds. AMZN stock is looking at gains of over 90% since the March selloffs and the company just posted quarterly revenue of $125.6 billion. Seeing all of this, investors could be wondering if AMZN stock has more room to run this year.
Surprisingly, the company continues to make major moves. On Tuesday, news broke that Amazon had quietly acquired Australian e-commerce platform, Selz. According to an announcement by Selz, the two companies closed the deal on January 15. No doubt, this is a solid play by Amazon as Selz facilitates digital acceleration for small- and medium-sized businesses. In theory, this would give it another edge over the competition. Given all of this, will you be investing in AMZN stock?
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Next up, we will be looking at industry titan, Shopify. To summarize, the company provides tools and services for retail businesses of any size to establish their online presence. As it stands, Shopify caters to over a million businesses across 175 countries. Moreover, it also supports Alibaba’s (NYSE: BABA) Alipay on its platform, connecting merchants with over a billion annual active users in China. Acting as the e-commerce middleman has paid off for both the company and its investors. SHOP stock has jumped by over 150% over the past year. As the company just released its full-year 2020 earnings yesterday, should investors be excited about Shopify’s future?
For one thing, Shopify performed phenomenally throughout 2020, as we all expected. The company’s annual revenue surged by 86% year-over-year. Its annual gross merchandise volume also increased by 96% compared to 2019. Furthermore, the company also saw its merchant solutions revenue for the quarter more than double compared to the same quarter last year.
Safe to say, few companies can boast such a global reach and vast e-commerce portfolio right now. Given its current momentum, do you think SHOP stock could continue to flourish in a post-pandemic world?
Another e-commerce presence on the radar now would be GoDaddy. The Maryland-based web hosting company works to empower everyday entrepreneurs around the world. Similar to our previous entry, it does so by providing the help and tools needed to succeed in the digital space. Specifically, GoDaddy helps its clients build professional websites, attract customers, and sell their products or services. Given the rise of digital acceleration in the retail sector, you could imagine GoDaddy seeing more demand for its services. Likewise, investors appear to be watching GDDY stock as well. It has soared by over 90% since the stock market crashed in March. If anything, the company has all but slowed down even in 2021.
To begin with, GoDaddy reported its fourth-quarter fiscal last week. In it, the company saw a total revenue of $873.9 million. Its total bookings added up to $943.1 million and domain revenue came in at $402.2 million. Additionally, GoDaddy reportedly added 1.4 million net customers throughout 2020, nearly double the amount added in 2019.
Despite its strong fiscal year, the company continues to bolster its core offerings. Earlier this month, it acquired all-in-one payment platform Poynt, adding payment solutions to its growing list of services. All things considered, will you be adding GDDY stock to your portfolio?
Topping off our list is Chinese e-commerce company, JD. To point out, it is one of the largest business-to-consumer online retailers in China by transaction volume and revenue. The company operates a massive Retail-as-a-Service business that helps its merchants drive productivity. On top of that, the company also has a massive fleet of delivery drones at its disposal.
You could say that it is no small name in the Chinese e-commerce industry. At the same time, JD stock has also been on a tear with gains of over 140% in the past year. In fact, it briefly hit a new all-time high during intraday trading yesterday on account of its latest move.
According to Bloomberg, JD is making plans to spin-off its shipping business in Hong Kong. By current estimates, JD Logistics Inc. could stand to raise $5 billion in its initial public offering, valuing the unit at about $40 billion. Should this be the case, JD would be making a major play to capitalize on China’s booming e-commerce industry. Could this make JD stock a top e-commerce stock to buy? Your guess is as good as mine.