Dec. 31st, 2017 – Fresh Internet World Stats convey to traders and investors alike a big growth play: 54% of the world now has Internet access. And 49% of all Internet users were found in a transforming Asia.
Internet Delivery Services is a 10-company industry niche in the Zacks Industry Rank ecosystem. It is currently getting a decent amount of love from analysts, with 3 upgrades and 1 downgrade.
The industry Rank this week was a stellar #42 out of 265 (Top 16%).
What’s going on here? Projected 12-month earnings growth for this industry is a whopping 50.3%! Such rocket fuel explains why the YTD return for these stocks is a tidy +21% and the 1-year return is +40%.
However, many of these stocks have reached the status of richly priced stocks too. The forward Price to Earnings ratio is 25.6 versus an S&P 500 at 17.1.
Here are three reasons for the huge growth—
A. Let the megastore IKEA website spell it out for you: You can do it yourself but you don’t have to!
Whether you’re shopping online or in store, you can afford to have someone else do the heavy lifting and deliver your purchases to your home or office. No matter the size or number of items in your order, you can now get it all delivered.
B. Physical Mail Delivery Services throughout the world know the consequences of this impact all too well.
Globally, the volume of letters that postal services receive is on the decline. The increasing use of electronic communications is a major cause of that decline.
C. China’s fastest-growing online industry segment in the first half of 2017 was Food Delivery.
Startups backed by Tencent Holdings and Alibaba Group Holdings touted discounts and marshaled armies of people to get restaurant meals to the homes of almost 300 million.
The population of people who rang up meals from phones and computers surged 41.6% to 295 million over the first six months, the government’s online industry overseers said in a biennial Internet snapshot.
That 41.6% growth is well in excess of other online China markets, including the 7.7% user growth in digital payments and 23.7% rise in ride hailing, both more mature sectors.
I list three top stocks by market capitalization--
(1) GrubHub Inc. (GRUB - Free Report) : This company is an online and mobile food ordering company.
This is a Zacks #3 Rank (HOLD) stock. The stock gets a D for Value but an A for Zacks Growth. The shares price at a lofty $103 and the market cap is $9.3 billion.
The company's platform assists diners in searching for local restaurant, tracking the order and re-order for convenience. It operates within the United States and the United Kingdom.
GrubHub Inc. is based in United States.
(2) MakeMyTrip Ltd. (MMYT - Free Report) : This is one of India’s leading online travel service companies. It offers travel products and solutions in India and the United States.
It’s a Zacks #2 Rank (BUY) stock right now. The share price is $35 and the market cap is $3.3 billion.
The company's services and products include air tickets, customized holiday packages, hotel booking, railway tickets, bus tickets, car hire and facilitating access to travel insurance.
Through its primary website, www.makemytrip.com, and other technology-enhanced platforms, the company provides access to all major domestic full-service and low-cost airlines operating in India, all major airlines operating to and from India, a wide selection of hotels in and outside India, Indian Railways and several major Indian bus operators.
MakeMyTrip Ltd. is based in Gurgaon, India.
(3) QuinStreet Inc. (QNST - Free Report) : This company is a provider of online direct marketing and media services.
It’s a Zacks #1 Rank (STRONG BUY) stock right now. The share price is $14 and the market cap is $617 million.
The company offers online messaging, email broadcasting, search engine marketing and brand management services. It caters to education, financial services, healthcare, advertising and tourism sectors.
QuinStreet, Inc. also operates a web portal that offers comprehensive consumer information service and companion insurance brokerage service to self-directed insurance shoppers.
QuinStreet Inc. is headquartered in Foster City, California.