Wall Street Expectations: How Online Shopping Companies Will Perform in 2020

2020 signals a stronger year for retail companies. With this, Wall Street has high expectations for online shopping, noting that it will experience unprecedented growth. As we will talk about below, it is obvious that even analysts are expecting a surge in the popularity of e-commerce, especially considering the performance of the biggest online retailers globally.

Before we start, for those who are interested in online shopping, check out Best Reviews Guide to find the top products from the best e-commerce stores.

Amazon

When we talk about online shopping companies, it is impossible to not mention Amazon. It is the largest e-commerce platform in the world. With this, analysts are also betting big on its performance in 2020. While last year has been profitable for Amazon, it is important to note that it has been underwhelming. Amazon stocks grew only approximately 13% in 2019.

This 2020, stock market analysts are predicting a better year for Amazon. In fact, in one article from CNN Business, it has been noted that as of January, a group of 50 analysts recommend buying Amazon stocks. It is expected that the earnings per share will be $4.05. The sales for the current quarter, on the other hand, is expected to reach $86 billion.

In the second half of 2019, Amazon introduced a number of changes in its services. For instance, it started offering free grocery delivery to Prime members. The delivery network has also expanded. Plus, it registered a stellar performance during the holiday sales period. With all of these, it is anticipated that the company will even be bigger in 2020, and this can drive the growth of their stock market performance.

eBay

Unlike Amazon, it has been a different story for eBay. Looking at its 2019 performance, it can be concluded that it has not been a so stellar year for eBay. The company’s asset-light business model is expected to help it make this year better.

In a consensus that involved 23 analysts, the recommendation is to hold eBay stocks. The wait-and-see tactic might be your best bet at the moment. 2020 has just started, so many are still keeping their hopes up that eBay will perform better compared to how it was in 2019. Analysts also predict that the 2020 annual earning for eBay will be $11 billion. This isn’t far behind from the $10.8 billion prediction in 2019.

Shopify

Shopify is more than just an e-commerce website. This is a platform that allows members to open their own stores and sell easily. It is a technology suite that makes it effortless to become an entrepreneur. Since the initial public offering in 2015, Shopify has been registering more than 70% growth annually. Nonetheless, the year-to-year performance has not been registering profits for one reason – the company is making heavy investments in its growth.

This 2020, it is also expected that Shopify will make it easy for entrepreneurs to start a business. Through a service called Shopify Capital, they will be offering an initial loan of $200 to help people get started. This is anticipated to bring more sellers into the platform, which will help it grow this year.

Looking at the stock market performance, 30 polled investment analysts recommend that you hold stock investments for now. From the initial forecast of $482 million earnings for the last quarter of 2019, the forecast earnings for the first quarter of 2020 is only $444 million. Because of this, a lot of people may be hesitant about the performance of the company’s stocks.

Walmart

While Walmart has a strong online presence, one thing that makes it unique compared those mentioned above is that it has physical stores. With both its online and offline presence, it is expected that Walmart will be bigger this 2020. Since 2016, the online sales of Walmart have been growing by as much as 78%, and there is no sign of slowing. It is also reported that the sales of Walmart are growing twice as fast as Amazon. Walmart has an extensive logistics network, which is what separates the company from most of its competitors.

The opinions of experts point out to buying Walmart stocks now. As of the time of writing, the current earnings per share is $1.45. Meanwhile, analysts are also forecasting that the revenue of the company by the end of 2020 will reach $525 billion. This is higher than the 2019 forecast of $514 billion. Stock analysts are positive that America’s third-largest online store will have a favorable performance this 2020.

Etsy

If you want to buy hand-made and vintage goods, it is hard to go wrong with Etsy. This online shopping platform has a unique niche compared to those that are mentioned above. The platform sells more than 60 million products. Out of which, it is estimated that more than 75% of them are hand-made. It is smaller in terms of scale of operations as against other retailers listed in this post. Nonetheless, the company has been proactive in pursuing strategies to beat some of its major competitors, including Amazon and Walmart.

According to stock market experts, buying Etsy stock is a good idea at this point. It is estimated that the earning for 2020 will be $1 billion. In 2019, the forecast was only $812 million. With the increase in sales anticipated, it is logical why many people are recommending getting your share of Etsy stocks now. With a price of only $.17 per share, this is the cheapest from all the online stores that we talked about in this article.

In sum, while online shopping is expected to become more popular this year, not all companies will benefit from the trend. Big-time retailers can be more profitable, but small businesses can suffer at their expense because of the intense competition. For stock investors, however, 2020 is a good year. Nonetheless, this will all depend on where you will be putting your stocks. You need to carry out thorough research to find the most profitable venture.

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Author: Eddy

Eddy is the editorial columnist in Business Fundas, and oversees partner relationships. He posts articles of partners on various topics related to strategy, marketing, supply chain, technology management, social media, e-business, finance, economics and operations management. The articles posted are copyrighted under a Creative Commons unported license 4.0. To contact him, please direct your emails to editor.webposts@gmail.com.