The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Carvana (NYSE:CVNA) and the rest of the online retail stocks fared in Q3.
Consumers ever rising demand for convenience, selection, and speed are secular engines underpinning ecommerce adoption. For years prior to Covid, ecommerce penetration as a percentage of overall retail would grow 1-2% annually, but in 2020 adoption accelerated by 5%, reaching 25%, as increased emphasis on convenience drove consumers to structurally buy more online. The surge in buying caused many online retailers to rapidly grow their logistics infrastructures, preparing them for further growth in the years ahead as consumer shopping habits continue to shift online.
The 6 online retail stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.2% while next quarter’s revenue guidance was 0.7% below.
Thankfully, share prices of the companies have been resilient as they are up 6.9% on average since the latest earnings results.
Best Q3: Carvana (NYSE:CVNA)
Known for its glass tower car vending machines, Carvana (NYSE:CVNA) provides a convenient automotive shopping experience by offering an online platform for buying and selling used cars.
Carvana reported revenues of $3.66 billion, up 31.8% year on year. This print exceeded analysts’ expectations by 5.3%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ EBITDA estimates.
Carvana pulled off the biggest analyst estimates beat and fastest revenue growth of the whole group. Unsurprisingly, the stock is up 1.3% since reporting and currently trades at $210.10.
Is now the time to buy Carvana? Access our full analysis of the earnings results here, it’s free.
Chewy (NYSE:CHWY)
Founded by Ryan Cohen, who later became known for his involvement in GameStop, Chewy (NYSE:CHWY) is an online retailer specializing in pet food, supplies, and healthcare services.
Chewy reported revenues of $2.88 billion, up 4.8% year on year, outperforming analysts’ expectations by 0.7%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates.
The market seems content with the results as the stock is up 2% since reporting. It currently trades at $34.25.
Is now the time to buy Chewy? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Wayfair (NYSE:W)
Founded in 2002 by Niraj Shah, Wayfair (NYSE:W) is a leading online retailer of mass-market home goods in the US, UK, Canada, and Germany.
Wayfair reported revenues of $2.88 billion, down 2% year on year, in line with analysts’ expectations. It was a slower quarter as it posted a significant miss of analysts’ active customers estimates and a decline in its buyers.
Wayfair delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The company reported 21.7 million active buyers, down 2.7% year on year. Interestingly, the stock is up 3.2% since the results and currently trades at $44.21.
Read our full analysis of Wayfair’s results here.
Coupang (NYSE:CPNG)
Founded in 2010 by Harvard Business School student Bom Kim, Coupang (NYSE:CPNG) is an e-commerce giant often referred to as the "Amazon of South Korea".
Coupang reported revenues of $7.87 billion, up 27.2% year on year. This number beat analysts’ expectations by 1.4%. Overall, it was a strong quarter as it also put up a solid beat of analysts’ EBITDA estimates and solid growth in its buyers.
The company reported 22.5 million active buyers, up 11.4% year on year. The stock is down 17.4% since reporting and currently trades at $22.22.
Read our full, actionable report on Coupang here, it’s free.
Amazon (NASDAQ:AMZN)
Founded by Jeff Bezos after quitting his stock-picking job at D.E. Shaw, Amazon (NASDAQ:AMZN) is the world’s largest online retailer and provider of cloud computing services.
Amazon reported revenues of $158.9 billion, up 11% year on year. This result surpassed analysts’ expectations by 1%. It was a strong quarter as it also logged an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ operating income estimates.
The stock is up 18.7% since reporting and currently trades at $221.06.
Read our full, actionable report on Amazon here, it’s free.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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