Kalkine Media explores 5 TSX e-commerce stocks to watch this season

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 Kalkine Media explores 5 TSX e-commerce stocks to watch this season
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Highlights

  • In Q3 2022, Shopify’s revenue was noted at US$ 1,366.2 million.
  • Lightspeed’s gross profit in Q3 2022 was US$ 81.4 million.
  • In Q2 FY 2023, mdf commerce’s adjusted EBITDA was C$ 1.35 million.

During and post-pandemic, e-commerce has become a way of life for people.  With the strict impositions and economic slowdown, the brick-and-mortar store has been sidelined with lower revenue. People stuck and working from home went with the flow and took advantage of the e-commerce sector. The option seemed easy for people to get things delivered to their doorstep.

Due to the changing trends, e-commerce is here to stay and not going anywhere. With many consumers and merchants entering, the industry is witnessing an increasing scale. Sometimes, investors may go with the ongoing trend. But it is vital to check the overall factors.

For e-commerce, along with the company financials, look for past and present performance as well. Many stocks are working to position themselves in this sector. But they may not be a suitable choice for you. Assess your portfolio needs and then go with the required stocks.

Let us explore five e-commerce stocks along with their recent financial highlights:

  1. Shopify Inc. (TSX: SHOP)

Shopify Inc. operates as an e-commerce platform catering to small and midsize businesses. The company has two segments that include-subscription solutions (43 per cent of fiscal 2018 revenue) and merchant solutions (57 per cent of fiscal 2018 revenue).

The former segment facilitates Shopify merchants to indulge in e-commerce on different platforms, including the company's website, kiosks, physical and pop-up stores. The latter segment operates as the platform’s add-on product, facilitating Shopify’s payments, shipping, and capital.

In Q3 2022, Shopify’s total revenue was noted at US$ 1.36 billion from US$ 1.12 billion in Q3 2021. The gross profit also rose to US$ 662.33 million from US$ 608.90 million in the same comparative period. The company’s net loss was posted at US$ 158.4 million versus a net income of US$ 1,148.4 million.

On July 8, 2022, Shopify acquired Deliverr, Inc.

  1. Lightspeed Commerce Inc. (TSX: LSPD)

Lightspeed Commerce Inc. is engaged in providing omni-channel commerce-enabling SaaS platform. The company provides its customers with various services including operations management, accepting of payments, and their business growth.

In Q3 2022, Lightspeed’s revenue grew to US$ 183.69 million from US$ 133.21 million in Q3 2021. The gross profit of the company rose to US$ 81.4 million from US$ 64.9 million for the same comparative period. The liabilities of the company declined to US$ 173.3 million from US$ 220.6 million in the preceding quarter.

The cash and cash equivalents of Lightspeed Commerce in two different periods:

  1. Nuvei Corporation (TSX: NVEI)

Nuvei Corporation is a payment technology provider that caters to its partners and merchants with technology solutions. The solutions provided by the company include in-store payments, mobile payments, and online payments.

In Q3 2022, Nuvei’s revenue witnessed an increase and was reported at US$ 197.1 million compared to US$ 183.9 million in Q3 2021. The gross profit soared to US$ 158.7 million from US$ 145.6 million for the same comparative period.

The net income decreased to US$ 13 million from US$ 28 million. The adjusted EBITDA of the reported quarter grew to US$ 81.2 million from US$ 80.9 million. The EPS (earnings per share) of the company is US$ 0.53 and the price-to-earnings (P/E) ratio is 81. Nuvei stock witnessed a QTD (quarter-to-date) increase of 15.69 per cent.

  1. Aritzia Inc. (TSX: ATZ)

Aritzia Inc. operates as a fashion house that includes integrated products. The company operates under the Artizia banner and is into designing apparel and accessories. Artizia’s product range includes jackets, sweaters, pants, T-shirts, skirts, shorts, jackets, coats, and accessories. Primarily, its presence is in the US and Canada.

In Q3 of fiscal year 2023, Artizia’s net revenue soared to C$ 525.5 million from C$ 350 million in Q3 2022. The gross profit grew to C$ 220.2 million from C$ 156.1 million for the same comparative period. The net income increased too and was noted at C$ 46.2 million versus C$ 39.8 million. The EBITDA rose to C$ 102 million from C$ 90.4 million. The P/E ratio is 33.1 with an EPS of C$ 1.62.

  1. mdf commerce inc. (TSX: MDF)

mdf commerce inc. is engaged in providing SaaS solutions to a wide range of sectors. This range deals with buyers and sellers by accelerating commercial interactions.

In Q2 of fiscal year of 2023, the revenue of the company was noted at C$ 33.21 million versus C$ 25.08 million in Q2 2022. The adjusted EBITDA rose to C$ 1.35 million from a loss of C$ 1.08 million. The gross margin of mdf commerce increased to C$ 19.36 million from C$ 18.49 million for the same comparative period. The company witnessed a QTD (quarter-to-date) growth of 45.45 per cent.

Bottom Line

Soon, delivery stores may become crucial compared to physical stores. But nothing is permanent and investors must be careful while selecting their stocks.

Always check with all the factors of the company and the stock before adding it to your portfolio. Another way is to diversify it. By spreading it out, you are spreading out the risk as well. Once the risk is mitigated, they may work in your favor. Therefore, look at the 360-degree view to stabilize your portfolio.

Please note, the above content constitutes a very preliminary observation based on the industry and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.

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