As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the online retail industry, including Chewy (NYSE: CHWY) and its peers.
Consumers ever rising demand for convenience, selection, and speed are secular engines underpinning ecommerce adoption. For years prior to Covid, ecommerce penetration as a percentage of overall retail would grow 1-2% annually, but in 2020 adoption accelerated by 5%, reaching 25%, as increased emphasis on convenience drove consumers to structurally buy more online. The surge in buying caused many online retailers to rapidly grow their logistics infrastructures, preparing them for further growth in the years ahead as consumer shopping habits continue to shift online.
The 6 online retail stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 3.4% while next quarter’s revenue guidance was 0.6% below.
Thankfully, share prices of the companies have been resilient as they are up 7.4% on average since the latest earnings results.
Chewy (NYSE: CHWY)
Founded by Ryan Cohen, who later became known for his involvement in GameStop, Chewy (NYSE: CHWY) is an online retailer specializing in pet food, supplies, and healthcare services.
Chewy reported revenues of $3.10 billion, up 8.6% year on year. This print exceeded analysts’ expectations by 0.8%. Despite the top-line beat, it was still a mixed quarter for the company with a narrow beat of analysts’ EBITDA estimates.
Chewy delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 9% since reporting and currently trades at $38.29.
Is now the time to buy Chewy? Access our full analysis of the earnings results here, it’s free.
Best Q2: Carvana (NYSE: CVNA)
Known for its glass tower car vending machines, Carvana (NYSE: CVNA) provides a convenient automotive shopping experience by offering an online platform for buying and selling used cars.
Carvana reported revenues of $4.84 billion, up 41.9% year on year, outperforming analysts’ expectations by 5.7%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and impressive growth in its units.
Carvana pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 143,280 units sold, up 41.2% year on year. The market seems happy with the results as the stock is up 13.7% since reporting. It currently trades at $379.10.
Is now the time to buy Carvana? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: Wayfair (NYSE: W)
Founded in 2002 by Niraj Shah, Wayfair (NYSE: W) is a leading online retailer of mass-market home goods in the US, UK, Canada, and Germany.
Wayfair reported revenues of $3.27 billion, up 5% year on year, exceeding analysts’ expectations by 4.8%. Still, it was a mixed quarter as it posted a significant miss of analysts’ customers estimates.
Wayfair delivered the slowest revenue growth in the group. The company reported 21 million active buyers, down 4.5% year on year. Interestingly, the stock is up 27.4% since the results and currently trades at $83.11.
Read our full analysis of Wayfair’s results here.
Revolve (NYSE: RVLV)
Launched in 2003 by software engineers Michael Mente and Mike Karanikolas, Revolve (NASDAQ: RVLV) is a fashion retailer leveraging social media and a community of fashion influencers to drive its merchandising strategy.
Revolve reported revenues of $309 million, up 9.4% year on year. This number surpassed analysts’ expectations by 3.7%. Overall, it was a very strong quarter as it also recorded an impressive beat of analysts’ EBITDA estimates and a narrow beat of analysts’ number of active customers estimates.
The company reported 2.74 million active buyers, up 6.4% year on year. The stock is up 10.2% since reporting and currently trades at $22.76.
Read our full, actionable report on Revolve here, it’s free.
Coupang (NYSE: CPNG)
Founded in 2010 by Harvard Business School student Bom Kim, Coupang (NYSE: CPNG) is an e-commerce giant often referred to as the "Amazon of South Korea".
Coupang reported revenues of $8.52 billion, up 16.4% year on year. This result topped analysts’ expectations by 2.1%. It was a very strong quarter as it also put up a solid beat of analysts’ EBITDA estimates and solid growth in its buyers.
The company reported 24.1 million active buyers, up 9.4% year on year. The stock is up 7.7% since reporting and currently trades at $32.24.
Read our full, actionable report on Coupang here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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