Spotting Winners: BigCommerce (NASDAQ:BIGC) And E-commerce Software Stocks In Q4
Let's dig into the relative performance of BigCommerce (NASDAQ:BIGC) and its peers as we unravel the now-completed Q4 e-commerce software earnings season.
While e-commerce has been around for over two decades and enjoyed meaningful growth, its overall penetration of retail still remains low. Only around $1 in every $5 spent on retail purchases comes from digital orders, leaving over 80% of the retail market still ripe for online disruption. It is these large swathes of the retail where e-commerce has not yet taken hold that drives the demand for various e-commerce software solutions.
The 6 e-commerce software stocks we track reported a mixed Q4; on average, revenues beat analyst consensus estimates by 1.7%. while next quarter's revenue guidance was 0.9% below consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and e-commerce software stocks have had a rough stretch, with share prices down 6.4% on average since the previous earnings results.
BigCommerce (NASDAQ:BIGC)
Founded in Sydney, Australia in 2009 by Mitchell Harper and Eddie Machaalani, BigCommerce (NASDAQ:BIGC) provides software for businesses to easily create online stores.
BigCommerce reported revenues of $84.15 million, up 16.2% year on year, topping analyst expectations by 3.2%. It was a weaker quarter for the company, with full-year revenue guidance missing analysts' expectations and management forecasting growth to slow.
“We have executed a notable financial transformation over the last several quarters,” said Daniel Lentz, CFO at BigCommerce.
BigCommerce delivered the weakest full-year guidance update of the whole group. The stock is down 26.8% since the results and currently trades at $6.05.
Read our full report on BigCommerce here, it's free.
Best Q4: Squarespace (NYSE:SQSP)
Founded in New York City in 2003, Squarespace (NYSE:SQSP) is a platform for small businesses and creators to build their digital presences online.
Squarespace reported revenues of $270.7 million, up 18.3% year on year, outperforming analyst expectations by 2.9%. It was a very strong quarter for the company, with an impressive beat of analysts' revenue estimates. However, profitability missed, leading to EPS below expectations. Looking ahead, guidance was promising with revenue outlook for the next quarter and the full year above Wall Street estimates.
Squarespace achieved the highest full-year guidance raise among its peers. The stock is up 6.7% since the results and currently trades at $36.
Is now the time to buy Squarespace? Access our full analysis of the earnings results here, it's free.
Slowest Q4: Wix (NASDAQ:WIX)
Founded in 2006 in Tel Aviv, Wix.com (NASDAQ:WIX) offers a free and easy to operate website building platform.
Wix reported revenues of $403.8 million, up 13.7% year on year, in line with analyst expectations. It was a weaker quarter for the company, with a miss of analysts' billings estimates and full-year revenue guidance missing analysts' expectations.
The stock is up 0.4% since the results and currently trades at $125.82.
Read our full analysis of Wix's results here.
Shopify (NYSE:SHOP)
Originally created as an internal tool for a snowboarding company, Shopify (NYSE:SHOP) provides a software platform for building and operating e-commerce businesses.
Shopify reported revenues of $2.14 billion, up 23.6% year on year, surpassing analyst expectations by 3.4%. It was a strong quarter for the company, with a decent beat of analysts' revenue estimates.
Shopify achieved the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is down 21.6% since the results and currently trades at $69.85.
Read our full, actionable report on Shopify here, it's free.
VeriSign (NASDAQ:VRSN)
While the company is not a domain registrar and does not directly sell domain names to end users, Verisign (NASDAQ:VRSN) operates and maintains the infrastructure to support domain names such as .com and .net.
VeriSign reported revenues of $380.4 million, up 3% year on year, in line with analyst expectations. It was a fairly decent quarter for the company, with a narrow beat of analysts' revenue estimates. EPS also came in well ahead of expectations showing that the company is staying on track.
VeriSign had the slowest revenue growth among its peers. The stock is down 7.4% since the results and currently trades at $186.33.
Read our full, actionable report on VeriSign here, it's free.
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