The e-commerce space has delivered massive growth since the beginning of the COVID-19 pandemic. Traditional brick-and-mortar retailers were forced to shutter their doors for much of 2020. This drew more consumers to the digital space. In September 2020, I’d looked at how investors could get in on this explosive sector. Today, I want to look at two e-commerce stocks that are worth snatching up in September. Let’s dive in.
Don’t let Shopify’s muted 2021 gains steer you away in September
Shopify (TSX:SHOP)(NYSE:SHOP) is an Ottawa-based company that provides a commerce platform and services to a worldwide consumer base. Its shares have climbed 39% in 2021 as of close on August 30. These gains have been somewhat muted compared to its performances in recent years. That should not dissuade investors from scooping up this exciting e-commerce stock for the long term.
In June, I’d discussed Shopify’s international expansion and why it would continue to benefit from the boom in the e-commerce space. The company unveiled its second-quarter 2021 results on July 28. Total revenue increased 57% year over year to $1.11 billion. Meanwhile, gross merchandise volume (GMV) surged 40%, or $12.1 billion, from the prior year to $42.2 billion. Adjusted net income more than doubled to $284 million, or $2.24 per diluted share.
Shopify achieved profitability over the past year. It has continued to post very impressive revenue growth in this friendly environment. This is a tech stock that Canadians should look to hold over the next decade, as e-commerce promises to be transformative in the retail space.
Here’s another e-commerce stock that has erupted since the pandemic
Shopify may be the big dog in the Canadian e-commerce space, but Lightspeed Commerce (TSX:LSPD)(NYSE:LSPD) has proven it is not to be ignored since the beginning of the pandemic. This Montreal-based company provides a commerce-enabling Software as a Service (SaaS) platform for small and midsize businesses. Shares of this e-commerce stock have climbed 59% in the year-to-date period. The stock is up 200% from the same time in 2020.
The company unveiled its first-quarter fiscal 2022 results on August 5. Revenue soared 220% year over year to $115 million. Meanwhile, its recurring subscription revenue increased 115% to $49.9 million. It posted an adjusted EBITDA loss of $6 million. This was an improvement over the prior year.
Lightspeed made some exciting strides on the business side in Q1 FY2022. It entered a partnership with OpenTable, the world’s leading provider of online reservations. The company also entered a definitive agreement to acquire Ecwid. With this acquisition, Lightspeed aims to bolster merchants’ ability to reach shoppers through social media and other digital marketplaces.
Like Shopify, this e-commerce stock is also on track for impressive revenue growth going forward. However, it does not possess Shopify’s superior balance sheet. Investors will want to see Lightspeed’s revenue growth translate to profitability in the quarters ahead.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Ambrose O'Callaghan has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Lightspeed POS Inc, Lightspeed POS Inc., and Shopify. The Motley Fool recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify.