EBAY: 3 Buy-Rated E-Commerce Stocks to Add to Your Watchlist

E-commerce platforms have seen a steep rise in demand amid the COVID-19 pandemic. The fear of being exposed to the virus has made people in general avoid in-person shopping and depend more on online platforms to purchase goods and services.

Shoppers’ preference for e-commerce over in-person shopping is likely to continue even after the pandemic due, simply, to the convenience it offers. This could lead to a permanent shift to e-commerce patronage by many.

The booming industry, which is currently dominated by a handful of major companies, could also witness the emergence of new players in the coming years. According to Oberlo, global e-commerce sales are estimated to increase to $6.5 in 2023 from 4.2 trillion in 2020.

eBay, Inc. (EBAY), Vipshop Holdings Limited (VIPS), and GoDaddy, Inc. (GDDY) have proven track records in this space and have delivered significant returns over the past year. We believe these companies’ expected growth in revenues and earnings should help their stocks to continue gaining in the coming months.

eBay, Inc. (EBAY)

EBAY operates an online platform that facilitates the sale of goods and products between merchants and customers. The company has operations in the U.S. and internationally. EBAY’s stock has gained 68.4% over the past year.

EBAY recently announced a partnership with Optoro to help smoothen the resale of returned and excess inventory. EBAY has plans to open a new online destination for the sale of refurbished goods.

For the quarter ended September 30, 2020, the company saw an increase in gross merchandise volume of 22% compared to the same period last year. Its revenues increased 25% during the same period.

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EBAY is expected to see a revenue growth of 7.1% for the quarter ended March 31, 2021 and 8.6% in 2021. Its EPS is estimated to grow 9.1% in 2021 and at a rate of 19% per annum over the next five years.

EBAY’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which equates to Buy in our proprietary ratings system. EBAY has a Momentum Grade of B and Quality Grade of A.

In total, we rate EBAY on 8 different levels. Beyond what we stated above we also have given EBAY grades for Stability, Sentiment, Growth, Value, and Industry. Get all the EBAY ratings here.

Vipshop Holdings Limited (VIPS)

VIPS operates as an online discount retailer. The company has operations primarily in China. VIPS’ stock has returned 117.5% over the past year.

VIPS recently appointed a new Co-Chief Technology Officer Pengjun Lu. In addition, , the company has appointed a new Chief Financial Officer David Cui. The new appointments are expected to help the company streamline its operations and drive future growth.

For the quarter ended September 30, 2020, VIOS saw an increase in total net revenue of 18.2% compared to the same period last year. Its gross profit increased 15.3% during the same period.

VIPS’ revenue is estimated to increase 48.4% for the quarter ended March 2021 and 17% in 2021. The company’s EPS is expected to rise 23.7% in 2021 and 2.9% per year over the next five years.

It is no surprise that VIPS has an overall rating of B, which equates to Buy in our POWR Ratings system. VIPS has a B for both its Growth and Momentum Grades, and a C for industry. . In the 86-stock China industry, it is ranked #17. Click here to see the additional POWR Ratings for VIPS (Value, Quality, Stability, and Sentiment).

GoDaddy, Inc. (GDDY)

GDDY is involved in the development of cloud-based products for web design professionals, small businesses, and individuals. GDDY’s stock price has increased 17.1% over the past year.

GDDY has recently launched corporate domains to better serve small businesses. For the quarter ended September 2020, the company saw an increase in revenue of 11% year-over-year. The company’s total bookings also increased by 11% during the same period.

GDDY’s revenue is expected to grow 11.7% for the quarter ended March 31, 2021 and 10.7% in 2021. The company’s EPS growth is expected to be 159.3% in 2021 and 31% per annum over the next five years.

GDDY’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which equates to Buy in our proprietary rating system. GDDY has a B for both Momentum Grade and Quality Grade.

Beyond what we stated above, we have also given GDDY grades for Stability, Sentiment, Growth, Value, and Industry. Get all the GDDY ratings here.

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EBAY shares were trading at $57.73 per share on Monday afternoon, up $1.22 (+2.16%). Year-to-date, EBAY has gained 14.89%, versus a 0.57% rise in the benchmark S&P 500 index during the same period.

About the Author: Aaryaman Aashind

Aaryaman is an accomplished journalist that’s passionate about providing in-depth insights about investing and personal finance. Recently he has been focused on the stock market and he specializes in evaluating high-growth stocks. More...