If you are following eCommerce companies (not Retail Commerce such as Home Depot, Walmart, etc.) there are 11 publicly listed companies that I am following. Of those 8 have reported earnings as of Nov 12th. JD.com reports on Nov 16th, SEA limited reports on Nov 17th and Chewy on Dec 14th.
Q3 2020 Earnings estimates and analysis
Companies tracked (ranked by market capitalization)
The top 5 takeaways from Q3 2020 earnings that I gathered
Covid has accelerated all eCommerce companies, but some are gaining more share than others.
Revenue growth for ETSY has been the highest so far at 128%, followed by Shopify at 96%. Alibaba has been growing slower, but that’s to be expected because of their large revenue base.
Earnings are growing faster for all
Surprisingly, except 2 companies (Chewy and Wayfair) all others turned a profit and the fastest earnings growth was seen from Pinduoduo (PDD) Etsy (ETSY) and Shopify (SHOP).
Valuations are deservedly rich thanks to EPS and Revenue Growth
The companies with the richest valuations are Pinduoduo (PDD), Mercado Libre (MELI) and Shopify (SHOP). ETSY is relatively cheap at 76 PE.
Stocks I would be adding to my portfolio are ETSY and consider JMIA / FTCH
ETSY’s valuation and growth are terrific. I am going to hold MELI and SHOP, but add to my ETSY holding. I would also keep Jumia (JMIA) and Farfetch (FTCH) in my watch list.
Stocks I would likely not add are Alibaba, Wayfair and Chewy
I think they are good companies, but have limited upside for a 6-12 month horizon given their growth relative to other eCommerce companies.