| Stock | Price | 52 Week Range | Marketcap | EPS | Dividend Yield | Chart (24H) | Sector | Employees | Last Updated |
|---|---|---|---|---|---|---|---|---|---|
 Amazon.com, Inc. AMZN | $223.81 | 2.39T | 6.56 | 0.00% | Consumer Cyclical | 1,560,000 | 13 hours ago | ||
 Shopify Inc. SHOP | $137.29 | 178.47B | 1.80 | 0.00% | Technology | 8,100 | 13 hours ago | ||
| $199.27 | 24.51B | 8.65 | 1.32% | Consumer Cyclical | 19,600 | 13 hours ago | |||
| $2,335.98 | 118.43B | 40.41 | 0.00% | Consumer Cyclical | 84,207 | 13 hours ago |
Ask 100 investors what the largest e-commerce stock in the U.S. is, and most would emphatically answer Amazon (NASDAQ:AMZN). It’s so obvious. In 2024, Amazon is expected to generate an astonishing $248 billion in online sales, $21 billion from physical store sales, and $172 billion in third-party seller fees, for a total of $441 billion. That’s a 12.5% increase from $392 billion in 2023. Don’t get me wrong—Amazon is fantastic for the long haul. But wouldn’t it be wise to diversify?
As a savvy investor, the global e-commerce market offers a plethora of opportunities beyond this juggernaut. According to an April 2024 blog post from Shopify (NYSE:SHOP), global e-commerce sales are projected to rise from $4.98 trillion in 2021 to $7.96 trillion by 2027—a robust compound annual growth rate (CAGR) of 8.1%. Think about it: if your business grew 8% annually, you’d be ecstatic. The point is, e-commerce remains a lucrative arena, and there are other big players making waves. Let’s uncover three e-commerce stocks that merit your attention: Williams-Sonoma, MercadoLibre, and Shopify.
E-commerce isn’t a fleeting trend; it’s a revolution that continues to reshape how we shop, sell, and invest. With a CAGR of 8.1%, the global e-commerce market is poised to grow from $4.98 trillion in 2021 to an eye-watering $7.96 trillion by 2027. Such significant growth can’t be ignored.
It’s tempting to think that Amazon is the only significant player, but that’s a myopic view. Diversifying within the e-commerce sector is prudent, and these other stocks offer a compelling mix of robust financial metrics, strategic positioning, and growth potential.
Editor's Note: Analysis and insight for this article were originally sourced from our friends at InvestorPlace
Williams-Sonoma (WSM): E-commerce Drivens Growth for Your Portfolio
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Balancing Acts and E-Commerce Ascendancy
Williams-Sonoma isn’t just a familiar name; it’s a market leader in home furniture and home goods retail. Its genius lies in balancing brick-and-mortar stores with an ever-growing online business. Notably, 66% of its 2023 net revenue came from e-commerce—a remarkable leap from 53% in 2016. That’s a significant shift, emphasizing the company’s focus on digital growth while maintaining its physical store experience.
The Numbers Tell the Story
The financials are jaw-dropping. Williams-Sonoma holds the third-largest position in the Global X E-Commerce ETF (NASDAQ:EBIZ) with a 5.13% weight. Its shares are up nearly 50% year-to-date and an astonishing 378% over the past five years. In 2023, the company posted $7.75 billion in net revenue, a significant portion of which came from e-commerce.
Operating profit surged from $472.6 million in 2016 to a monumental $1.5 billion in 2023, pushing the operating margin up by 800 basis points from 9.3% to 17.3%. E-commerce has proven to be a catalyst for profitability and long-term growth for Williams-Sonoma. The impressive balancing act between online and offline, coupled with stellar financial performance, makes it a must-own stock.
Analyst Ratings and Forecasts for WSM
| Category | Value |
|---|---|
| Consensus Rating | Overweight |
| Average Price Target | $174.15 |
| Potential Gain | 14.1% |
| Number of Ratings | 14 |
Summary of Analysts’ Outlook:
Analysts have a positive outlook on Williams-Sonoma, with a consensus rating of Overweight. The average price target of $174.15 suggests a potential gain of 14.1% from the current price. Most analysts expect the company to continue its strong performance, driven by its omni-channel strategy, product innovation, and cost savings initiatives.
Sources:
- Bloomberg: Williams-Sonoma Inc. (WSM) Analyst Ratings
- Refinitiv: Williams-Sonoma Inc. (WSM) Analyst Estimates
- TipRanks: Williams-Sonoma Inc. (WSM) Analyst Ratings
- Yahoo Finance: Williams-Sonoma Inc. (WSM) Analyst Estimates
MercadoLibre (MELI): E-Commerce and Finance – A Dual-Fueled Giant Emerges
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The Power Duo: E-Commerce Meets Fintech
MercadoLibre isn’t merely an e-commerce company; it’s a revolution in Latin America. The company seamlessly combines e-commerce and fintech services to provide comprehensive solutions in regions with limited banking access. Imagine Amazon combined with PayPal—that’s MercadoLibre.
A Challenger with Potential
MercadoLibre is the 15th-largest holding in the Global X E-Commerce ETF with a 3.32% weight. Its shares have risen nearly 9% year-to-date and an astronomical 169% over the past five years. Started in 1999, MercadoLibre has grown to become one of the world’s top five e-commerce companies, standing tall even in challenging business environments.
From $472.6 million in revenue in 2013, MercadoLibre has expanded remarkably. In 2023, it generated $2.39 billion from commerce and a staggering $4.73 billion from fintech, marking growth rates of 41.2% and 32.6% respectively. The dual focus on e-commerce and fintech makes it a diversified growth stock that serves a broader market need.
Analyst Ratings and Forecasts for MELI
| Metric | Value |
|---|---|
| Consensus Rating | Overweight/Buy |
| Average Price Target | $1,343.15 |
| Potential Gain | 24.1% |
| Number of Ratings | 24 |
Summary of Analysts’ Outlook:
Analysts are overwhelmingly bullish on MercadoLibre, with 19 out of 24 ratings being a Buy or Overweight. The average price target suggests a potential gain of 24.1% from the current price. Analysts appreciate the company’s dominant position in Latin American e-commerce, its growing fintech business, and its ability to navigate the COVID-19 pandemic.
Sources:
- Bloomberg: MELI Analyst Ratings
- Yahoo Finance: MELI Analyst Estimates
- TipRanks: MELI Analyst Ratings
- Refinitiv (formerly Thomson Reuters Financial & Risk): MELI Analyst Estimates
Shopify (SHOP): The Small Business Savior with a Promising 14.1% Return Outlook
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The Small Business Champion
Shopify isn’t just a platform, it’s a lifeline for countless small and medium-sized enterprises (SMEs). The company empowers these businesses to set up, run, and thrive in online stores. Despite recent stock struggles—down nearly 20% year-to-date—Shopify remains a powerhouse for potential long-term gains.
Resilient Growth and Promising Future
Shopify is the 22nd-largest holding in the Global X E-Commerce ETF with a 2.50% weight. Over the past five years, its shares have climbed a remarkable 79%, despite a considerable dip post-2021. The tides seem to be turning, however. Out of 51 analysts covering Shopify, 30 rate it a “buy” with a target price of $76.20—nearly 30% higher than its current trading value.
When Shopify reported its Q1 2024 results, President Harley Finkelstein was brimming with confidence. He stated, “You’re seeing the strongest version of Shopify in our history. Our outstanding Q1 performance is clear proof of our dedication to the new shape of Shopify, our commitment to operating with a consistent team size, and our focus on building for the long-term to deliver both growth and profitability.”
You’re seeing the strongest version of Shopify in our history. Our outstanding Q1 performance is clear proof of our dedication to the new shape of Shopify, our commitment to operating with a consistent team size, and our focus on building for the long-term to deliver both growth and profitability.
Harley Finkelstein
Analysts like CIBC’s Todd Coupland have even more optimistic views, reiterating a “buy” rating with an $85 target price. Shopify’s focus on long-term growth and profitability makes it a stock worth keeping a keen eye on.
Analyst Ratings and Forecasts for SHOP
| Metric | Value |
|---|---|
| Consensus Rating | Overweight (Buy) |
| Average Price Target | $1,343.44 |
| Potential Gain | 14.1% |
| Number of Ratings | 34 |
Summary of Analysts’ Outlook:
Analysts are overwhelmingly bullish on Shopify, with a consensus rating of Overweight (Buy). The average price target of $1,343.44 suggests a potential gain of 14.1% from the current price. Analysts are impressed with Shopify’s strong revenue growth, expanding ecosystem, and increasing adoption of its platform by merchants.
Sources:
- TipRanks: Shopify (SHOP) Analyst Ratings
- Yahoo Finance: Shopify Inc. (SHOP) Analyst Estimates
- Bloomberg: Shopify Inc. (SHOP:US) Analyst Estimates
E-commerce is so much more than Amazon. The three stocks we’ve discussed—Williams-Sonoma, MercadoLibre, and Shopify—are perfectly poised for sustained growth, offering excellent opportunities to diversify your portfolio in this booming sector. Each of these companies employs unique strategies tailored to their markets, ensuring they capitalize on global e-commerce trends effectively.
Stay tuned to Market Monitors for more expert insights and top-tier stock recommendations. To be successful in this ever-evolving market, keep yourself informed, stay ahead of trends, and always explore the boundless opportunities that e-commerce offers. Your financial future could very well be shaped by these emerging stars.