The Zacks Analyst Blog Highlights Amazon.com, Carvana, Cars.com, Groupon and Rover Group
For Immediate Release
Chicago, IL – October 24, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Amazon.com Inc. AMZN, Carvana Co. CVNA, Cars.com Inc. CARS, Groupon Inc. GRPN and Rover Group Inc. ROVR.
Here are highlights from Monday’s Analyst Blog:
5 Online Retailers to Buy on Solid Sales in September
On Oct 17, the Department of Commerce reported that retail sales in September increased 0.7% month over month, significantly beating the consensus estimate of 0.3%. Moreover, the metric for August was revised upward to an increase of 0.8% from 0.6% reported earlier. Within overall retail sales, online sales grew 1.1% in September, second only to a 3% jump in miscellaneous store retailers.
Internet - Commerce continues to evolve as the technologies driving it advance. On the one side are increasingly powerful and capable user devices. On the other are sophisticated, AI-enabled software platforms facilitating transactions more capable of delivering user satisfaction.
Differentiation comes from better technology for improved showcasing, easier navigation and payment, speedier delivery and returns, brand building, comparison shopping, loyalty, etc., as well as more shipping options, which generally tip the scales in favor of larger players.
Within the Retail sector, the Zacks-defined Internet-Commerce industry is currently in the top 37% of the Zacks Industry Rank. Year to date, the industry has provided 32% returns. Since it is ranked in the top half of Zacks Ranked Industries, we expect the e-commerce industry to outperform the market over the next 3 to 6 months.
Our Top Picks
We have narrowed our search to five e-commerce stocks with strong potential for 2024. These stocks have seen positive earnings estimate revisions in the last 90 days.
Amazon.com Inc. has been benefiting from a strengthening AWS services portfolio and its growing adoption rate has contributed well. Ultrafast delivery services and an expanding content portfolio are positives for AMZN. The strengthening relationship with third-party sellers is also encouraging. Its advertising business is also making a robust contribution. Improving Alexa skills along with robust smart home product offerings are tailwinds for AMZN.
Amazon has an expected revenue and earnings growth rate of 12.9% and 38.2%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 3.2% over the last 90 days.
Carvana Co. has been benefiting from acquisitions. The acquisition of Car360 has enhanced CVNA's 360-degree photo capabilities with 3D computer vision and augmented reality. The acquisition of ADESA's U.S. operations has solidified CVNA's logistics network and auction capabilities.
It is expected to unlock approximately 2 million units of incremental annual production capacity at full utilization. CVNA's efforts to increase its penetration in existing markets, enter new markets, gain more customers and strengthen its marketing activities are likely to aid the firm.
Carvana has an expected revenue and earnings growth rate of 12.7% and 27.8%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 2.2% over the last 90 days.
Cars.com Inc. operates an online automotive platform. CARS offers new and used vehicle listings, expert and consumer reviews, research tools and other information. CARS also engaged in the sale of display advertising to national advertisers.
Cars.com has an expected revenue and earnings growth rate of 6.4% and 59%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 5.7% over the last 90 days.
Groupon Inc. operates a marketplace that connects consumers to merchants. GRPN is taking initiatives to improve customer engagement and retention by orienting its marketplace to serve everyday customer problems instead of just focusing on discounts. This involves monitoring prices as well as the removal of high refunding merchants. GRPN is looking to save costs annually by lowering tech costs through automation.
Groupon has an expected revenue and earnings growth rate of 5.9% and more than 100%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved more than 100% over the last 90 days.
Rover Group Inc. provides an online marketplace for pet care. ROVR connects pet parents with pet providers who offer overnight services, including boarding and in-home pet sitting, as well as daytime services, including doggy daycare, dog walking, drop-in visits and grooming.
Rover Group has an expected revenue and earnings growth rate of 17.7% and more than 100%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved more than 100% over the last 90 days.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
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Rover Group, Inc. (ROVR) : Free Stock Analysis Report
