E-commerce stocks to watch - What is the best investment option?

24 June 2021

E-commerce is one of the fastest-growing industries globally. In 2019, almost 2 billion people around the world purchased goods and services online, while the total retail sales were as much as $3.5 trillion. As for the total value of the market globally, it was as much as $9.09 trillion in 2019.

The coronavirus pandemic in 2020 further showed the importance of e-commerce. In the first half of 2020, online sales in the US alone increased by 30%. From 2020 to 2027, the global e-commerce market is expected to grow as much as 15 percent every year.

The e-commerce industry is growing very rapidly, which is creating a lot of opportunities for both long-term and short-term investors. However, there are several things that investors might have to focus on while looking for e-commerce companies to buy on the stock market. This includes the performance of the company in the past as well as its future prospects. Below, we will discuss some of the best e-commerce stocks for investors.

Investing in e-commerce stocks

When thinking of the biggest trends in the market, e-commerce might not be the first one that comes to mind. Compared to futuristic markets such as artificial intelligence, virtual reality, or even autonomous vehicles, e-commerce might not be as exciting.

However, e-commerce stocks shine when it comes to long-term opportunities, but are susceptible to political changes in the world. E-commerce forever revolutionized the way people buy products and since there still is room for growth, it represents a great investment option. Among some of the most popular e-commerce stocks, you can find:

Amazon
Etsy
Alibaba
Shopify

But, this is not all. There are many other companies on the e-commerce stocks list, so, let’s discuss some of the best e-commerce stocks and learn why they are worth your time.

Amazon

When it comes to e-commerce stocks, one of the most successful companies is Amazon. It was actually among one of the few companies that managed to be very successful even during the Covid-19 pandemic. The main reason for this was the huge demand for the services of the company.

In 2020, Amazon managed to have a record quarterly revenue of more than $125 billion. In addition to this, Amazon doubled the net income on a year-over-year basis mainly because of the e-commerce operations.

Amazon also has a lot of prospects for the future. The company is showing interest in several different fields, which is making it a perfect e-commerce stock on the market for investing.

Created by Jeff Bezos in 1994, Amazon is now listed on the Nasdaq exchange. Over the years, Amazon has transformed into a giant company and in addition to e-commerce, its revenues also come from subscription services, cloud computing, Whole Foods grocery sales, and many other areas.

eBay

With more than 182 million users, eBay represents one of the largest e-commerce companies in the market. eBay is available in as many as 190 different countries, making it one of the best e-commerce stocks to buy in 2021.

According to official data from 2019, as much as $22 billion worth of goods were bought and sold on eBay. eBay is a very fast-growing company, which can be a great long-term investment option.

Etsy

Etsy is another leading e-commerce company that largely focuses on selling handmade or vintage items and crafts. Thanks to the global marketplace that it has created, the company connects millions of people around the world.

The shares of the company have had a very interesting run. For example, although the shares of the company fell during the beginning of 2020 due to the Covid-19 pandemic, it was very quick to increase again.

This has brought gains of over 500 percent for some traders. As with many other e-commerce companies, Etsy's earnings were also significantly boosted by the Covid-19 pandemic. The last quarter of 2020 was significantly successful for the company, seeing its total revenue more than doubling. In 2020, the representatives of the company also noted that they were working towards adopting a long-term growth strategy.

According to some reports, Etsy was able to meet its 2023 goals throughout fiscal 2020, which makes it one of the fastest growing e-commerce stocks.

Alibaba

Another giant company that also should be discussed while talking about e-commerce is Alibaba. This Chinese multinational tech giant is very similar to the other two we have already discussed above. Alibaba represents the largest Chinese e-commerce company.

Much like many other e-commerce companies, Covid-19 also increased the revenue of Alibaba, which was over $33.8 billion for the last quarter of 2020. This was a total of 37% increase compared to 2019. As of December 2020, the company announced 92 million mobile monthly active users.

That said, Alibaba has always been very popular among nationals of different countries, not only China. The company actually became the second Asian company to break the $500 billion valuation mark back in 2018. Because of the success of the company, it is one of the largest retailers and e-commerce companies globally.

One thing that makes Alibaba a very popular e-commerce stock is its future plans. The company is working very hard to partner with other leading companies globally to have access to a broader audience.

Shopify

This cloud-based e-commerce platform is one of the top choices for investors because of several reasons. In the third quarter of 2020, the company has reported as much as $767 million of revenue.

This was as much as a 96% increase compared to the same period of the year prior. This is a very fast-growing company, which is providing investors with a lot of opportunities for both short-term and long-term turnovers. This Canadian e-commerce company is listed on NYSE.

Peloton Interactive

Another representative of the e-commerce sector stocks is Peloton. This company mainly focuses on marketing and developing home exercise equipment and offers different types of workout programs.

The company is the largest interactive fitness platform with over 4.4 million members. In 2020, the shares of the company skyrocketed, increasing as much as 300 percent mainly due to the lockdown measures around the world. One of the reasons why the company is thought to have successful future prospects is that it is working to become accessible in different parts of the world, aiming at Australia and the Asia Pacific region.

E-commerce companies stocks - Key takeaways

Investing in some of the best e-commerce stocks might be a great idea because of the size of this market. According to the data from 2019, domestic e-commerce sales were as much as $130 billion.

In addition to this, experts are predicting that this market will have more than a 15% increase every year, making it an amazing investing option. Some of the best examples of e-commerce companies include eBay, Amazon, Shopify, and Etsy among many others.

Frequently Asked Questions on e-commerce company stocks

What are the best e-commerce stocks?

E-commerce stocks are among some of the top-performing stocks online. E-commerce has forever changed the way people buy and sell products, and investing in e-commerce stocks can be a great long-term investment option. Some of the best e-commerce stocks to invest in are Amazon, eBay, Alibaba, Etsy, and many others. But what makes them good e-commerce stocks?

The main reason for these companies to be among the best e-commerce stocks is their size and future prospects. In addition, these stocks have had a successful chart history as well. For example, during the Covid-19 pandemic, the shares of these companies were increasing due to the huge demand for e-commerce companies.

These giant companies are the best fit for long-term investment. On the other hand, there also are e-commerce small cap stocks that might be a better option for short-term investors.

What is e-Commerce stock?

E-commerce stocks have been very popular among retail traders for a long time. E-commerce is a very large market that envisages buying or selling products using online services. Over the years, dozens of companies have been created around the world for this purpose.

The shares of these companies are called e-commerce stocks, and because of the popularity of such companies, these shares are traded very frequently.

Although e-commerce is already a very large market, it still does have room for growth, which makes it a very popular choice for investors. There are many e-commerce companies around the world, and a huge majority of them are offering services globally.

Is e-commerce stocks a good investment?

There are several reasons why e-commerce stocks might be a good investment. Among the best e-commerce stocks, investors can find companies with great future prospects. These can be companies that have revenue in billions of dollars, that are great for long-term investment, or small-cap companies that might be a better choice for short-term investment.

The best thing about e-commerce stocks, which is one of the major reasons for its popularity, is the fact that it still has room for growth. There are millions of people who are becoming part of the e-commerce market every day, and these companies are forever changing and transforming the way people shop around the world.