As investors punish Shopify, these 15 ecommerce companies are expected to grow sales the most through 2023

Shopify had a blowout fourth quarter, with sales rising 41% from a year earlier, the company reported after the market close on Feb. 15.

Sales are the main objective of a company working at the forefront of the shift to ecommerce. But Shopify’s stock fell 26% over the following two trading sessions, even after company reported results that came in ahead of analysts’ expectations for revenue and earnings.

Read: Shopify sees a sales slowdown in the first half of 2022.

The above headline from Barron’s spells out the problem in this market environment for any highly valued tech stock: Even in a growing economy with better-than-expected retail sales, if a company’s own sales outlook for the months ahead disappoint investors, the stock can crash.

While we cannot predict which highly valued ecommerce companies might be next to disappoint investors, we can look ahead to see which are expected to increase sales the most quickly. A list of these expected rapid-growers derived from the holdings of three ecommerce exchange-traded funds is below.

A high valuation in a touchy market

Here’s a three-year price chart for Shopify Inc.
through the close on Feb. 15 — that is, before the company announced its fourth-quarter results:


The stock was up fivefold for three years before Shopify put out its fourth-quarter results. And the stock was trading for 14.5 times the consensus forward sales estimate among analysts polled by FactSet. That’s a very high valuation when compared with a price/sales valuation of 2.6 for the S&P 500
and 2.9 for a venerable internet services highflyer such as Amazon.com Inc.

Investors were paying through the nose for Shopify’s stock. Then again, the stock had traded as high as 47.1 times the consensus forward sales estimate in July 2020.

Three ecommerce ETFs

In order to come up with a list of ecommerce stocks for a screen, we looked at three ETFs focusing on this industry group:

  • The ProShares Online Retail ETF
    has $581 million in assets under management and holds 39 stocks. It is heavily concentrated, with Amazon making up 25% of the portfolio and Alibaba Group Holding Ltd.
    the second-largest holding at 13.6%. The third-largest holding is eBay Inc.
    at 4.5%.
  • The Amplify Online Retail ETF
    has $475 million in assets, holds 79 stocks. The individual stocks are equal-weighted within the portfolio, which itself is 70% weighted to the U.S. According to FactSet, this approach “keeps giants [such as] Amazon from dominating the basket, but also introduces a bias to smaller and possibly more risky firms.”
  • The Global X E-Commerce ETF
    has $151 million in assets. It holds 40 stocks and has a modified weighting by market capitalization. Its top five holdings make up 13.1% of the portfolio. Expedia Group Inc.
    is the largest holding, at 6.7%, followed by Booking Holdings Inc.
    at 6.4% and JD.com Inc.
    at 5.5%.

Leaving the ETFs in size order, here are projected compound annual growth


Business or know-how? Two-tier blend of expertise expected to progress in the 2020s

Electronic isn’t the only transformation likely on these times — there is also a profound vocation transformation reshaping the roles and aspirations of the people today developing the electronic earth. This is generating some confusion in the technologies occupation room, as tech gurus are becoming advised they have to have to pay additional focus to developing organization capabilities above their deep technological awareness. 


Photo: Joe McKendrick

Whilst tech administrators and professionals are evolving to much more business enterprise-concentrated roles, they also will need to deliver their technology capabilities to the desk as properly. “Some technologists who want to continue to be palms-on with deployment and innovation” — and that is all right, claims Haluk Saker, senior vice president for Booz Allen Hamilton. “Businesses are earning way for deep complex leadership and recognizing the worth that senior IT engineers bring to govt-level discussions and determination-creating. For all those who are passionate technologists, who want to keep on being in the trenches, it can be crucial to obtain organizations and cultures that have created technical management a precedence.”  

To fix difficulties as a result of technology, “it truly is not likely to be about a new deal with or performance,” says Saker. “Tomorrow’s leaders will have to have to have a twin aim that balances specialized skills with immersion in the mission.”    

Welcome to the era of the renaissance know-how expert, who desires to be outfitted with two tiers of competencies, providing an potential to seem at challenges from both of those technological and folks views. The 2020s organization calls for that, experts across the organization know-how landscape concur.

Know-how skills needs have not long gone absent, but the target has shifted absent from standard coding, integration and systems efficiency operate and now includes delivering business enterprise benefit. Get to know the business enterprise, marketplace observers recommend. “It truly is significant to start out to study about finance, small business processes, and other tactics that make up how your product or option arrives comprehensive-cycle for your organization,” states Nag Vaidyanathan, chief know-how officer at Duck Creek Technologies. “How you collaborate with other capabilities is critical to the results you can reach.”    

“My track record is in program improvement, and for significantly of my vocation the obstacle was figuring out how to make the 1s and 0s get the job done,” states Saker. “Currently, with technologies like cloud and other electronic capabilities, advancement groups seem really unique and there is certainly an significantly empowered person foundation. User experience and design and style has develop into even more vital than in the past.” 

To advance in the 2020s, “it can be critical for IT experts to continue to be correct to who we are as inventive trouble solvers,” claims Vaidyanathan. “We are made use of to learning new factors, striving new items, and failing at new things. We’re also extremely common with collaborating and iterating to be constantly strengthening and often producing a improved remedy.”

That consists of a focus on