BigCommerce Vs Shopify : Which Stock Is A Better Buy?

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Summary

  • Ever since it went public last year, BigCommerce Holdings Inc (Nasdaq: BIGC, BIGC:US) has been pitted against fellow e-commerce giant Shopify Inc (TSX:SHOP).
  • While there is a wide difference between Amazon and Shopify in terms of their business, the former is quite similar to BigCommerce that way.
  • BigCommerce offers businesses and individuals SaaS-based services pertaining to design, shopping cart and payment.

Ever since it went public last year, BigCommerce Holdings Inc (Nasdaq: BIGC, BIGC:US) has been pitted against fellow e-commerce giant Shopify Inc (TSX:SHOP). So let’s compare the two companies in terms of their business, financials and stock performances to see how they fare against one another.

BigCommerce vs Shopify: Stock Performance


Shopify, founded about three years before BigCommerce, has climbed up the ranks to become the second largest e-commerce platform in the world in terms of revenue, right after Amazon.

©Kalkine Group 2020

Since going public in May 2015, its stock price has ballooned by over 4,500 per cent in the last nearly six years.

BigCommerce stock, on the other hand, has sunk nearly 13 per cent since going public in August 2020.

Despite it trailing Shopify stock by such a huge margin, some market experts believe that BigCommerce could emerge as a stronger contender in ecommerce market in the future.

BigCommerce vs Shopify: Business

While Shopify is often compared to Amazon, their businesses are actually quite different from each other’s. Amazon is much like the virtual version of a store via which vendors can sell their products, whereas Shopify is an online platform where people can run their individual online shop, like a market place.

With BigCommerce, however, Shopify does not seem to have much of a difference, especially with it offering businesses and individuals SaaS-based services pertaining to design, shopping cart and payment.

So, many believe that the competition between Shopify and BigCommerce will actually be the one to watch.

BigCommerce vs Shopify: Financials


BigCommerce recorded a total revenue of US$ 152.4 million last year, which was 36 per cent up year-over-year (YoY). Shopify, meanwhile, posted an 89 per cent YoY revenue growth in 2020, amounting to US$ 2,929.5 million.

©Kalkine Group 2021

Shopify also accumulated an annual net income of US$ 319.5 million last year, or US$ 2.59 per diluted share, while its Texas-based peer registered a non-GAAP net loss of US$ 30.7 million in 2020, which was 20 per cent of its of total revenue.

In terms of sales too, the difference between the two companies is huge, which BigCommerce reportedly posting US$ 154 million in sales last year and Shopify securing nearly US$ 3 billion.

While taking these difference into account, investors should also keep in mind the fact that Shopify had also started small once. Since getting its shares publicly listed in 2015, its revenue has inflated massively.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.

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