As we navigate through the fourth quarter of 2024, all eyes are on the upcoming holiday sales season. Market analysts have shifted their focus to the retail projections for the 2024-25 holiday season, with e-commerce sales expected to shine bright amidst a backdrop of muted or declining in-store sales. This trend positions internet-commerce stocks, such as Amazon.com Inc. (AMZN), Wayfair Inc. (W), and Travelzoo (TZOO), as compelling choices for investors in the short to medium term.
Positive Projections for Online Holiday Sales
According to Adobe, the 2024 holiday sales from Nov. 1 through Dec. 31 are estimated to hit a record-high of $240.8 billion, marking an 8.4% year-over-year increase. Mobile transactions are anticipated to represent 53.2% of total online sales, climbing 12.8% annually.
Mastercard SpendingPulse foresees a 3.2% year-over-year rise in total retail sales from Nov. 1 to Dec. 24, 2024, with online retail sales expected to grow 7.1% annually. Deloitte’s estimates suggest a year-over-year increase of 2.3-3.3% in total holiday sales from November 2024 to January 2025, with e-commerce sales projected to surge by 9% year over year.
EMARKETER’s data indicates that holiday sales during the November-December period are poised to grow by 4.8% annually, reaching $1.353 trillion. However, online sales are forecasted to increase by 9.5% year over year. Additionally, Salesforce predicts a 2% yearly growth in 2024 holiday sales, totaling $272 billion.
Top 3 E-Commerce Stocks to Monitor This Holiday Season
These notable e-commerce stocks boast robust growth potential for the remainder of 2024. Furthermore, they exhibit significant price upside in the short term, each holding a Zacks Rank #3 (Hold).
The chart below demonstrates the price performance of these three e-commerce stocks over the past three months.
Image Source: Zacks Investment Research
Amazon.com Inc.: A Tech Powerhouse
Amazon continues to lead the way with its innovative devices strategy, particularly driven by Alexa-powered Echo devices. The seamless integration of AI through Alexa into various household devices has swiftly expanded the smart home market’s growth potential. Additionally, Amazon’s dominance in cloud services with Amazon Web Services (AWS) is a key driver of its global cloud infrastructure leadership.
Wayfair Inc.: Riding the Wave of Growth
Wayfair’s upward trajectory is fueled by an increasing customer base, strong market share bolstered by product availability and speedy deliveries, and substantial growth in repeat customers. The company’s mobile app orders are thriving, and its fulfillment solutions and supplier advertising are driving positive outcomes.
Travelzoo: Setting Sail in the Digital Realm
Travelzoo, an Internet media company, excels in providing subscribers and website users with travel, entertainment, and local deals information. With operational segments in Asia Pacific, Europe, and North America, Travelzoo is positioned as a key player in the digital content space.
Envisioning Growth: Price Potential for These E-Commerce Stocks
Amazon is predicted to experience a revenue growth rate of 10.4% and an earnings growth rate of 63.5% for the current year, with the average price target signaling a 21.3% increase from the last closing price of $180.80.
Wayfair anticipates revenue and earnings growth rates of 5% and over 100%, respectively, for the upcoming year, with the average price target indicating a 15.7% rise from the last closing price of $56.32.
Travelzoo’s expected revenue and earnings growth rates for the current year stand at 2.3% and 21.3%, respectively, with the average price target reflecting a substantial 77.2% surge from the last closing price of $11.88.
