3 Plays On E-Commerce

I don’t know how you could have missed it, but in case you did, Amazon (AMZN) blew earnings out of the water recently, with the stock busting through all-time highs, notes Eddy Elfenbein, editor of Growth Stock Advisor.

While cloud services revenues were stellar, so were Amazon’s e-commerce numbers. But, what if you want to participate in the booming e-commerce sector, but don’t want to buy a $2,000 stock and push Mr. Bezos’ net worth even higher?

I think there is a better way. And, it captures not only e-commerce but any transaction that can be done in digital form. I’m talking about the exploding field of Payments, and the companies that are reshaping how both consumers and businesses do transactions.

According to a recent McKinsey and Company report, global revenue from payments, combining retail and corporate, stands right at $2 trillion. And, while revenue growth is somewhat lumpy, depending on the country you’re in, the global average is 6% annually.

FinTech and large financial institutions have been transforming the payments landscape, providing faster, more secure, and increasingly mobile payment options. And as the services get better, that means more and more digital payments and a lot of money for payment companies.

Here are a few of the ones I see benefitting from the payments boom.

Square (SQ) has been around for several years and is becoming pretty commonplace in the restaurants and retail establishments I frequent. They have a touch screen cash register that lets you sign right on the screen used by the cashier.

The stock has pulled back from the $100 level, which it grazed briefly in 2018, and trades around $80 today. Square took in $1.27 billion in revenue in Q3, a 44% quarter-over-quarter increase while increasing year-over-year payment volume by 25%.

One of the most exciting things going on at Square is the Cash App. This is an app that lets individuals send and spend money. But, they have just added functionality for the app to let investors buy fractional shares of stock, another booming investment area. For Q3, Cash App revenue was up 115% year-over-year.

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