E-commerce offers a more convenient alternative to buying products at a mall or another physical location. Many strong buy e-commerce stocks have capitalized on this trend over the years, but the industry is still growing at a fast pace.
E-commerce leaders continue to post impressive financials. These same firms have been offering guidance that suggests more growth is on the way. Investors looking to tap into the e-commerce industry may want to consider positions in these three equities.
Walmart (WMT)
Walmart (NYSE:WMT) is an American retailer that has been offering affordable goods and services to consumers since 1962. WMT has gained over 19% in the past year and is up by just under 70% over the past five years.
Those gains may continue on the back of a recently announced 3-for-1 stock split. Stock splits don’t do anything to a company’s value but can result in investors rushing to accumulate shares before the stock split date. However, the buzz around stock splits seems to have been muted in recent quarters.
Luckily, Walmart has more than a stock split going for it. The company grew revenue by 5.2% year-over-year (YOY) in the Q3 FY2024 and raised its guidance for the year. Global advertising and e-commerce were the big winners. Those segments had year-over-year growth rates of 20% and 15%, respectively. International sales were up by 10.8% YOY and outpaced domestic sales.
As Walmart continues to grow, it also continues to reward long-term investors. The company bought back $1.3 billion in shares year-to-date and offers a 1.40% dividend yield.
Amazon (AMZN)
Amazon (NASDAQ:AMZN) has been a reliable stock for long-term investors. Shares are up by 77% over the past year and have gained 116% over the past five years.
The e-commerce giant continued to grow across multiple markets and increased net sales by 14% YOY in the fourth quarter of 2023. Net income reached $10.6 billion in the quarter.
The successful earnings report has prompted many analysts to hike their price targets for the tech giant. While e-commerce and Amazon Web Services are the major attractions, investors should also monitor revenue growth in the company’s advertising segment.
Advertising revenue increased by 27% YOY which outpaced the company’s revenue growth as a whole. The company generated $14.7 billion in ad revenue which was almost 10% of the company’s $170.0 billion total revenue.
Amazon stock gives investors exposure to a heavily diversified portfolio that taps into e-commerce, cloud computing, artificial intelligence, advertising, gaming and other verticals.
Visa (V)
Visa (NYSE:V) is the stock that keeps on giving. The fintech company bought back $3.4 billion worth of shares during the three months ended December 31, 2023. Even after that splurge, the company has $26.4 billion of remaining authorized funds to buy back its stock.
Visa generated $4.9 million in GAAP net income during that quarter which was a 17% YOY improvement. Net revenue came in at $8.6 billion, which was 9% higher YOY. Those figures helped the company achieve a 54.4% net profit margin. High-profit margins and continued growth make it easier for the company to buy back billions of dollars worth of stock.
The credit and debit card leader has also delivered steady stock gains. Shares are up by 20% over the past year and have gained 90% over the past five years. The stock trades at a 27.5 forward P/E ratio and features a 0.75% dividend yield. Visa regularly raises its dividend payout by at least 10% per year.
On the date of publication, Marc Guberti did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.