5 TSX stocks to buy in October ahead of holiday season

Highlights

• According to data released by Statistics Canada, retail ecommerce sales were approximately C$4 million in June 2021 as compared to C$3.5 million in the previous year.
• The clothing and accessories component led the retail sector and recorded 13.61 per cent year-over-year growth.
• Businesses could expect high turnovers by the year’s end given the accelerated vaccination programs worldwide and an ease of restrictions.

With Thanksgiving just around the corner and the upcoming holiday season sales, the businesses have high hopes as the end of 2021 inches closer.  

According to data released by Statistics Canada, the retail ecommerce sales were approximately C$4 million for June 2021 quarter as compared to C$3.5 million in the previous year quarter.

The retail sales number was up by 6.16 per cent year-over-year and core sales 3.61 per cent for the year ending June 2021. It was up by 4.57% as compared to May 2021 sales, indicating the materialization of consumers’ pent-up demand.

Among different components in retail sales, clothing and accessories with 13.61% YoY growth led the retail sector back to life. The category also recorded a 49.08% month-over-month increase discernably due to post-lockdown sales across the country.

Also read: What e-commerce businesses need to know about cryptocurrencies?

As the holiday season sale is approaching, we picked up the following five stocks investors may consider.

1.      Shopify Inc (TSX:SHOP)

The Canadian e-commerce giant’s stocks soared over 50 per cent in the past one year. It posted US$ 1.12 billion total revenue in Q2 2021, up by 57 per cent YoY.

Currently trading at C$ 1,734.90, Shopify stocks posted a price-to-earnings ratio (P/E) of 73.40 and return on equity (RoE) of 33.36 per cent on September 29.

2.      Canada Goose Holdings Inc. (TSX:GOOS)

The prospect of heading into the colder season and the holidays could boost sales of winter wear. Canada Goose recently ventured into the footwear business and will roll out high-tech boots and hikers as early as November.

Canada Goose stocks presently trade at C$ 47.44 apiece and posted 31.69 per cent year-to-date (YTD) growth. The stock held a P/E ratio of 83.30 as of September 28.

Canada Goose in its recent Q1 fiscal 2022 financials said that global e-commerce sales were by 80.8 per cent YoY.

Also read: 5 Canadian penny stocks to buy under $1

3.      Nuvei Corporation (TSX:NVEI)

Nuvei Corp provides online payment solutions to vendors, including in-store payments, mobile payments and online payments. The fintech stock has soared nearly 192.6 per cent in the past one year of trading.

With a market cap of C$ 21.19 billion, the software firm recorded a 146 per cent jump in total volume in the three-month period ended June 30. It said that e-commerce represented 84 per cent of the total volume.

4.      Cargojet Inc (TSX:CJT)

Canada’s leading air freight company as per their website, Cargojet Inc believes that customer demand is highest in the Q4 of each fiscal due to increase in retail activity during the holiday season as the year’s end inches closer.

In the second quarter of fiscal 2021, the air cargo firm recorded 15 per cent YoY growth in revenue largely to the domestic network business.

The stocks trading at C$ 208.50 apiece posted 9.3 per cent growth in the past one year. The Cargojet stock at present holds a P/E ratio of 96.20.

5.      Lightspeed Commerce Inc (TSX:LSPD)

Given the boost in digital payments across the globe, the upcoming holiday season is likely to boost spending on various e-commerce platforms, including for firms like Lightspeed Commerce Inc.

The firm provides an omni-channel commerce platform for merchants. Its total revenue shot by 220 per cent YoY.

It said that its first quarter results for fiscal 2022 were majorly assisted by an increasing adoption of its cloud-based commerce platform and economies reopening across the globe.

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Bottom line

The COVID-19 pandemic has taken a heavy toll on small, medium and large retailers, traders, and standalone businesses. Despite lurking fear of the Delta variant, the e-commerce sector could sustain the momentum as people indulge in holiday shopping.