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E-commerce Stocks' Q3 Earnings on Nov 1: STMP, TVPT, MELI & W

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The e-commerce sector continues to gain momentum in this data driven world on the back of increasing penetration of internet usage globally. This conducive scenario has enabled the e-commerce companies to expand customer base even in emerging markets.

Moreover, emerging m-commerce remains a major catalyst for this sector driven by the growing proliferation of smartphones in this fast-paced world.

Further, the rapidly growing online retail and travel space continue to be the key growth drivers within this particular sector. Expanding online product and services portfolio worldwide is also bolstering the user engagement in e-commerce market.

Additionally, smart technologies like artificial intelligence (AI), augmented reality (AR)/virtual reality (VR), machine learning (ML) and deep learning are aiding retailers in offering a personalized user experience. This is expected to continue driving growth in this sector.

Per a report from Deloitte, the e-commerce sales are projected to lie within the range of $128 to $134 billion in 2018, reflecting growth of 17-22% from 2017. The immense growth opportunities are alluring enough to attract companies to this sector, in turn intensifying the competition.

It is to be noted that Amazon continues to rule the roost in the e-commerce domain with its aggressive retail strategy. The company reported third-quarter results last week wherein it crushed earnings estimates and reflected year-over-year growth of 29.3% in its revenues.

However, the company’s revenues missed the estimates and also failed to provide strong guidance for the next quarter.

It is worth mentioning that a company’s earnings outperformance is dependent on the overall business environment as well as management’s ability to implement operating and strategic plans. Therefore, earnings beat for all companies in the space is not ensured.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or #5 (Strong Sell) are best avoided.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Let’s see what’s in store for the following four software stocks slated to report third-quarter 2018 results on Nov 1.

Stamps.com Inc. offers internet-based postage services that enable the enterprises and consumers to print U.S. Postal Service-approved postage at home or office. Notably, the company has topped the Zacks Consensus Estimate in the trailing four quarters, recording average positive earnings surprise of 38.38%.

The company is likely to benefit from its strengthening shipping segment and proper execution of its strategic plans.

The company has a Zacks Rank #3 and an Earnings ESP of 0.00%, which makes the surprise prediction difficult in the to-be-reported quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stamps.com Inc. Price and EPS Surprise

 

Stamps.com Inc. Price and EPS Surprise | Stamps.com Inc. Quote

Travelport Worldwide Limited provides distribution, technology, payment and other solutions to the global travel and tourism industry via its online platform. Notably, the company has topped the Zacks Consensus Estimate in three of the trailing four quarters, delivering average positive earnings surprise of 18.01%.

The company’s continued investment in search, mobile enablement, merchandising and shopping, payments and its cloud architecture will continue to diversify business. This is likely to drive third-quarter 2018 results. However, macro headwinds in Northern Europe’s travel space are concerns.

The company has a Zacks Rank #3 and an Earnings ESP of 0.00%, which makes the surprise prediction difficult in the to-be-reported quarter.

MercadoLibre, Inc. (MELI - Free Report) holds a leading position in the e-commerce space of Latin America. The company’s increasing adoption rate of MercadoPago and growing number of confirmed registered users are likely to aid top-line growth in the third-quarter 2018.

However, MercadoLibre’s mounting expenses pose serious risk to its margin expansion. Notably, the company has missed the Zacks Consensus Estimate in the trailing four quarters, delivering negative average earnings surprise of 62.62%.

The company has a Zacks Rank #3 and an Earnings ESP of 0.00%, which makes the surprise prediction difficult in the to-be-reported quarter.

MercadoLibre, Inc. Price and EPS Surprise

 

MercadoLibre, Inc. Price and EPS Surprise | MercadoLibre, Inc. Quote

Wayfair Inc. (W - Free Report) is an online seller of home goods products, such as furniture and home décor items. The company continues to ride on its robust direct retail business and growing numbers of orders from new as well as repeated customers. However, its increasing advertising and investment expenditures remain concerns.

Notably, the company has missed the Zacks Consensus Estimate in the trailing four quarters, delivering negative average earnings surprise of 18.55%.

Wayfair has a Zacks Rank #3 and an Earnings ESP of 0.00%. Consequently, our proven model does not conclusively show an earnings beat in the to-be-reported quarter.

Wayfair Inc. Price and EPS Surprise

 

Wayfair Inc. Price and EPS Surprise | Wayfair Inc. Quote

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