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 Wayfair (NYSE:W) 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 5 online retail stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.5% while next quarter’s revenue guidance was 0.8% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
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 $3.12 billion, up 8.1% year on year. This print exceeded analysts’ expectations by 3.4%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ revenue estimates.
Interestingly, the stock is up 14.7% since reporting and currently trades at $99.20.
Is now the time to buy Wayfair? Access our full analysis of the earnings results here, it’s free for active Edge members.
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 $5.65 billion, up 54.5% year on year, outperforming analysts’ expectations by 11.1%. The business had an exceptional quarter with an impressive beat of analysts’ revenue estimates and impressive growth in its units.
Carvana pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 155,941 units sold, up 43.5% year on year. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 17.6% since reporting. It currently trades at $291.88.
Is now the time to buy Carvana? Access our full analysis of the earnings results here, it’s free for active Edge members.
Slowest Q3: Revolve (NYSE:RVLV)
Launched in 2003 by software engineers Michael Mente and Mike Karanikolas, Revolve (NASDAQ:RVLV) is a fashion retailer leveraging social media and a community of fashion influencers to drive its merchandising strategy.
Revolve reported revenues of $295.6 million, up 4.4% year on year, falling short of analysts’ expectations by 0.8%. It was a slower quarter as it posted a slight miss of analysts’ revenue estimates and a slight miss of analysts’ number of active customers estimates.
Revolve delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The company reported 2.75 million active buyers, up 4.5% year on year. Interestingly, the stock is up 7.6% since the results and currently trades at $21.50.
Read our full analysis of Revolve’s results here.
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 $180.2 billion, up 13.4% year on year. This number surpassed analysts’ expectations by 1.2%. It was a strong quarter as it also recorded an impressive beat of analysts’ EPS estimates and a narrow beat of analysts’ revenue estimates, as Amazon Web Services and North America all beat.
The stock is up 9.4% since reporting and currently trades at $243.80.
Read our full, actionable report on Amazon here, it’s free for active Edge members.
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 $9.27 billion, up 17.8% year on year. This result beat analysts’ expectations by 2.7%. Overall, it was a very strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ revenue estimates.
The company reported 24.9 million active buyers, up 9.8% year on year. The stock is down 9.3% since reporting and currently trades at $29.15.
Read our full, actionable report on Coupang here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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