5 Stocks to Play the Coronavirus-Led Online Delivery Boom

­­­­­­­­­­­­­­­­­­­Globally, online shopping and e-commerce have seen a significant rise in recent years. In fact, convenience in shopping and better discounts have been grabbing the attention of consumers and leading them to shift from traditional to online shopping.

Now, as the coronavirus pandemic has put nations under lockdown, shopping online is not only safe but also convenient. According to the latest Brick Meets Click and Symphony RetailAI Online Grocery Survey, home delivery and store pickup online grocery sales has hit a new 30-day record for April. Sales have hit $5.3 billion, increasing nearly 33% from previous month’s $4 billon.

Coronavirus Ramps Up Digital Shift

With stay-at-home orders in place, e-commerce sales in the United States have increased 49% for daily average online sales in between Mar 12 to Apr 11, compared with daily average online sales from Mar 1 to Mar 11, according to Adobe Analytics.

Market Edge From Zacks · 5 Stocks to Navigate the Coronavirus Earnings Season

 

In fact, there has been significant growth in sales of grocery, alcohol and books. Per Adobe Analytics data, online grocery sales increased 110% between Mar 12 and Apr 11, while online alcohol books sales increased 75% and 100%, respectively.

Additionally, the global online grocery market size is expected to reach $1.1 trillion by 2027. The market is expected to witness a CAGR of 24.8% from 2020 to 2027, per a study conducted by Grand View Research, Inc. The study shows that the rising number of smartphone users and their shift to app-based shopping is going to boost market growth over the forecast period.

Along with that the adoption of Internet of things (IoT) is expected to open new avenues for the online grocery market over the forecast period. IoT will help e-commerce organizations maintain inventory and provide real-time data and help retailers analyze the demand for different products in different regions.

5 Stocks to Watch

With lockdowns likely to prevail, online sales will see significant growth in the next few weeks if not months. Hence we have shortlisted four stocks that are likely to benefit from the boom in online delivery.

Chewy, Inc. CHWY provides pet food and treats, pet supplies and pet medications. The company’s expected earnings growth rate for the current year is 27.6% compared with the Zacks Consumer Products - Staples industry’s projected earnings growth of 8.1%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 17.8% upward over the past 60 days. What’s more, Chewy carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Wayfair Inc. W offers selection of furniture, décor, decorative accents, house wares, seasonal decor, and other home goods. The company’s expected earnings growth rate for the current year is 8.8% against the Zacks Internet - Commerce industry’s projected earnings decline of 10.1%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 6.7% upward over the past 60 days. Wayfair has a Zacks Rank #2.

Vipshop Holdings Limited VIPS operates as an online discount retailer. The company’s expected earnings growth rate for the current year is 17.9% compared with the Zacks Internet - Delivery Services industry’s projected earnings growth of 9.5%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 7.8% upward over the past 60 days. Vipshop Holdings has a Zacks Rank #2.

eBay Inc. EBAY operates the marketplace and classifieds platforms that connect buyers and sellers worldwide. The company’s expected earnings growth rate for the current year is 7.8% against the Zacks Internet - Commerce industry’s projected earnings decline of 10.1%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 0.3% upward over the past 60 days. eBay carries a Zacks Rank #3 (Hold).

Amazon.com, Inc. AMZN engages in the retail sale of consumer products and subscriptions. The company’s expected earnings growth rate for the current year is 21.8% against the Zacks Internet – Commerce industry’s projected earnings decline of 10.1%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 2.3% upward over the past 90 days. Amazon.com carries a Zacks Rank #3.

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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
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