3 Top E-Commerce Stocks To Watch Right Now
E-commerce stocks appear to be in an interesting position in the stock market today, to say the least. By and large, several factors have and continue to weigh in on the sector now. This is apparent as investors consider a rather mixed bag of U.S. economic data coming in this week. On one hand, the U.S. gross domestic product (GDP) growth for the third quarter came in at 2.0%, below consensus estimates of 2.6%. With the economic recovery seemingly slowing down, some would argue that demand for e-commerce services could follow suit.
On the other hand, investors also received upbeat job market and consumer confidence-related data. Namely, the Labor Department’s weekly jobless claims metric fell to a new pandemic-era low. In detail, initial unemployment claims for the week came in at 281,000 versus estimates of 288,000. If that wasn’t enough, U.S. consumer confidence rose in October after three consecutive months of declines. Couple all this with rising wages amidst the current labor shortages and the bull thesis for e-commerce stocks continues to grow.
Regardless of all this, the e-commerce industry continues to push forward as well. For instance, we could look at the likes of Amazon (NASDAQ: AMZN). Sure, the company’s overall sales for the quarter are seeing a slight slowdown with an earnings per share of $6.12 on revenue of $110.81 billion. Given that these figures are being compared to blowout quarters, this is not surprising. Elsewhere, firms like Stitch Fix (NASDAQ: SFIX) that thrived throughout the pandemic continue to adapt their businesses. This is evident as the firm recently launched its ‘Freestyle’ service, giving customers much more flexibility on its platform. With all that said, could one of these top e-commerce stocks be worth watching in the stock market now?
Best E-Commerce Stocks To Buy [Or Sell] Ahead Of November 2021
- Sleep Number Corporation (NASDAQ: SNBR)
- Affirm Holdings Inc. (NASDAQ: AFRM)
- Shopify Inc. (NYSE: SHOP)
Sleep Number
Starting us off today is Sleep Number (SNBR). As the name suggests, the company specializes in manufacturing and marketing beds. In essence, SNBR offers consumers beds alongside foundations and other related bedding accessories. Among its flagship offerings is the award-winning 360 Smart Beds. The likes of which adapt across sleep sessions to provide users with optimized experiences. Aside from its network of over 625 locations across the U.S., SNBR has and continues to invest heavily in its e-commerce operations as well.
Given the relevance of the home furnishing industry throughout the pandemic, SNBR stock continues to gain in the stock market. Since its Covid era low, the company’s shares are now up by a whopping 480%. Thanks to its latest quarterly earnings report, investors could be eyeing SNBR stock now. Notably, the company posted an earnings per share of $2.22 on record revenue of $640 million for the quarter. In particular, SNBR crushed consensus earnings per share estimates of $1.44. Overall, CEO Shelly Ibach cites the SNBR teams’ stellar execution and SNBR’s current business model as notable growth catalysts throughout the quarter.
Regarding its long-term growth outlook, SNBR appears to be confident as well. The company is now eyeing an earnings per share of $7.25 for the fiscal year, a sizable 57% year-over-year leap. Given all of this, would SNBR stock be a top buy for you now?
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Affirm
Another name to consider in the e-commerce space now would be Affirm. Sure, most would not immediately think of AFRM stock as an e-commerce stock. However, you can’t deny that Affirm’s fintech services are becoming an increasingly relevant element in the digital shopping world today. For the uninitiated, Affirm primarily offers Buy-Now-Pay-Later (BNPL) services. In short, BNPL allows consumers to pay for their purchases over time in smaller amounts. Given the rise in consumer demand for BNPL services, e-commerce giants across the board continue to turn to Affirm.
Even now, AFRM stock is currently sitting on year-to-date gains of over 65%. This would be thanks to its numerous partnerships with the likes of Amazonand Target (NYSE: TGT) among other firms. In fact, the company’s shares surged by over 7% during intraday trading yesterday on account of its latest alliance. Impressively, Affirm is now working with American Airlines (NASDAQ: AAL), offering its BNPL services to travelers. With the current resurgence in consumer travel demands, this would be a welcomed service for travelers. This would be the case as the overall upfront cost of vacations could be substantially reduced through BNPL solutions.
Not to mention, the company also recently launched its Affirm Debit+ debit card. To highlight, it is the first U.S. debit card to offer pay over time functionality, according to Affirm. With consumer spending normally ramping up during the year-end holiday seasons, will you be keeping an eye on AFRM stock?
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Shopify
Following that is Shopify. For the most part, the Canadian firm is an expert in enabling businesses of all sizes in the digital space. Accordingly, the company’s digital marketplace is now home to over 1.7 million merchants from across the globe. Through Shopify, said merchants have access to a wide array of retail tools. This includes but is not limited to highly customizable storefronts, seamless checkout systems, and developer-friendly scripts on-site. All of which serves to optimize their businesses. As such, Shopify would stand to benefit from any potential tailwinds in the e-commerce industry now.
Evidently, SHOP stock is still holding on to gains of over 320% since the early days of the pandemic. This would suggest that investor interest in the company and its long-term growth prospects persist. This is apparent as the company’s shares soared by a whopping 7.93% during yesterday’s trading session. Understandably, this would be on account of the company’s third fiscal quarter earnings report posted yesterday.
For starters, Shopify posted a total gross merchandise volume of $400 billion for the quarter. Additionally, it also raked in a total revenue of $1.12 billion, marking a solid 46% year-over-year increase. According to Shopify, this is thanks to steady growth in its subscription solutions and merchant solutions. Namely, both divisions posted year-over-year revenue hikes of 37% and 51% respectively. Regarding its outlook for the fourth quarter, Shopify believes that it will “contribute the largest share” of its full-year revenue. Given the company’s current momentum, could SHOP stock be worth investing in for you?
