Global E-Commerce Trend Still Kickin' -- Here Are the Four-Plus Stocks to Watch

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Growth investors: Don't count out e-commerce just yet as the secular trend in tech is still alive and kicking. 

A team of tech analysts at Goldman Sachs, led by Heath Terry, just raised their estimates on global e-commerce spend, and there's no shortage of stocks to pick for considerable exposure to the trend. 

Global E-Commerce Spend

Goldman Sachs is now estimating an 18% compound annual growth rate from 2018 through 2022 on e-commerce spend around the world, up from previous estimates of roughly 17%. Analysts said the two main drivers of that increased spend are store closures amongst brick-and-mortar retailers and the move to one-day shipping, initiated by several e-commerce, retail and delivery and logistics companies. 

China, India and Latin American countries will likely drive the highest portion of e-commerce spend, Goldman said, with China currently positioned as the most prolific grower in the category. Goldman is looking for China's CAGR for the time period to be 21%, although various other industry reports suggest India's e-commerce CAGR for the next few years could be around 22% or higher. 

Stocks to Consider 

Goldman's favored e-commerce stocks are Amazon (AMZN) - Get Report , Alibaba (BABA) - Get Report , JD.com (JD) - Get Report and Yahoo Japan. Unsurprisingly, Alibaba, JD and Yahoo Japan all see 100% of their revenue and earnings from the Asia Pacific region, according to FactSet. Amazon sees about 15% of its revenue from the Asia region, not a small portion for a large global company. 

Goldman did not name eBay (EBAY) - Get Report or Etsy (ETSY) - Get Report in its top e-commerce picks, but eBay does see roughly 20% of its revenue from Asia, and Etsy 13%. 

On valuation, e-commerce companies trade at levels all over the map, seemingly. Amazon trades at 52 times next year's earnings, but reflected in that multiple is several high-growth business, such as the cloud. Alibaba, an e-commerce pure play, trades at just under 20 times earnings, attractive compared to JD's 24 times, but expensive compared to Ebay's 12.7. Etsy trades at 57 times earnings. 

Also important to note, there are other ways to get exposure to e-commerce . FedEx (FDX) - Get Report is heavily invested in being a dominant player in e-commerce. Its FedEx Express business accounts for roughly 33% of its earning-before-interest-and-tax. Walmart (WMT) - Get Report is also growing online sales at a fast clip and developing its one-day shipping capabilities. 

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