[ad_1]
E-commerce has increased due to the conditions created by the coronavirus pandemic, and the major players in the industry have produced eye-catching feedback. However, investors should be aware that the online retail revolution is only just beginning.
With that in mind, we put together a panel of Motley Fool contributors and asked each member to profile one of the best ecommerce stocks to buy in 2021. Read on to see why they think Amazon (NASDAQ: AMZN), Etsy (NASDAQ: ETSY), and Free market (NASDAQ: MELI) are about to crush the market.
Image source: Getty Images.
An online sales giant ready for more wins
Keith Noonan (Amazon): Naming Amazon as one of the top ecommerce titles won’t earn points for its originality. Investors who bought the stock at virtually any point in its publicly traded history have enjoyed overwhelming returns for the market. It’s always a great time to buy Amazon stocks.
Amazon currently controls about half of the U.S. business-to-consumer e-commerce market. The online retail giant has also shown that it is better at innovating than any other business.
In addition to its revolutionary e-commerce service, Amazon leads the cloud computing market. The company is also building a rapidly growing position in an industry parallel to online sales: digital advertising. A recent study by Cowen estimates that the company’s platform will account for around 13% of global ad sales, excluding the Chinese market.
There is a huge overlap in the technology and data needed to move e-commerce, cloud computing and digital advertising businesses forward, making Amazon stronger as a whole. The company can also be seen as one of the early leaders in potentially revolutionary trends including artificial intelligence, robotics and autonomous vehicles.
Amazon is one of the best companies in the world and has demonstrated a penchant for innovation that shapes the market. The already massive size of the company means that it will find it harder to generate relative growth compared to smaller players in the industry, but Amazon stands out as a reliable industry leader that offers attractive risk-reward dynamics for businesses. growing investors.
The online craft fair
Joe tenebruso (Etsy): If you need a personalized, handmade gift, there’s a good chance you’ll find yourself on Etsy.com eventually. Buyers flocked to the e-commerce market during the pandemic to find products they couldn’t find elsewhere – a trend that is expected to accelerate in the coming years.
Etsy is great at connecting manufacturers with consumers. The number of active sellers on its platform jumped 42% year-on-year to nearly 3.7 million in the third quarter, while the number of buyers climbed 55% to 69.6 million. Etsy charges a small fee for each transaction. Collectively, these fees totaled $ 341.6 million in the third quarter, a year-over-year increase of 141%. Etsy also offers sellers a range of services, from which it generated $ 109.9 million, up 95% from the period a year earlier.
Face masks have been another major growth driver for Etsy during the COVID-19 crisis. This is a segment where sales are likely to decline. But while many people have joined Etsy’s mask market over the past year, they will likely stick around for its ever-growing selection of handmade products. Non-mask gross merchandise (GMS) sales in the Etsy marketplace soared 93% to $ 2.2 billion in the third quarter.
Yet despite this scorching growth, Etsy has just scratched the surface of its long-term expansion potential. The company expects its online market opportunity to reach $ 437 billion by 2023. With so much growth to come, investors who buy Etsy shares today should be well rewarded.
This leader is shaping powerful trends
Jamal Carnette (MercadoLibre): MercadoLibre is often referred to as “the Amazon of Latin America,” but even this lofty designation might underestimate its true potential. Stocks have been on fire over the past year, rising 160% as the pandemic has displaced many online shopping, but long-term growth is just beginning.
While it may seem ubiquitous, with 15% of retail sales, the United States, which has 90% internet penetration, is still in the early stages of e-commerce. Compare that with two of MercadoLibre’s largest countries – Brazil and Mexico – which have internet penetration rates of 70% and 65%, respectively. MercadoLibre stands to gain from increased internet penetration leading to further adoption of e-commerce and continues to rapidly develop unique active users, registering a 92% increase in the third quarter.
However, real savvy investors are more excited about the company’s Mercado Pago digital payment platform. Originally designed to support payments on the MercadoLibre site, it has expanded to include off-platform transactions, such as grocery stores, and as a person-to-person money transfer mechanism. Mercado Pago continues to grow at a rapid pace, with total payment volumes up 161% on a currency neutral basis and off-platform volume growth of 197% in the third quarter.
It’s not often that you find businesses with two highly scalable businesses, but that’s what MercadoLibre has with its e-commerce marketplace and digital payment solutions. In addition, with MercadoLibre, you have growth engines over decades as internet penetration will drive e-commerce and the number of underbanked and unbanked citizens will increase demand for its digital payment solutions. Maybe it’s time to call MercadoLibre the “Amazon” and Pay Pal from Latin America. “
[ad_2]
Source link