The holidays are almost here and whilst we are splurging on toys, gifts, and copious amounts of food, it is always good to add a little extra to your nest egg, no matter the time of year. So here are two companies that could be a good investment this holiday season.
Walmart (NYSE: WMT) is the planet’s largest company by revenue as well as being the largest private-sector employer in the world. To further illustrate this fact, the company is on track to generate $550 billion in 2020 and as a result, shares have grown more than 20% this year.
Walmart rolled out Walmart+ as its latest foray into the e-commerce industry. The hope is to claw into the competition where Amazon reigns supreme, by leveraging it’s brick-and-mortar stores alongside the newly vamped up digital service. Indeed, its Walmart+ service will help retain new customers gained during the pandemic, particularly as it only costs $12.95 per month and same-day delivery is available at 2’700 of its stores. In addition, Walmart and Shopify have teamed up to help 3rd party sellers escape the pervasive grasp of Amazon, redirecting them to Walmart’s own marketplace.
On the other hand, achieving high growth will be difficult for a company like Walmart, mainly due to the sheer size of the business; sales growth for its fiscal 2020 grew only 2% year-over-year (YoY). This is likely to get harder as more and more people opt for online shopping whilst Walmart still gets the vast majority of its revenue from brick-and-mortar stores. Furthermore, competition with Amazon in this arena will be tough and could impact future growth.
Walmart is a business that is currently transitioning from fully brick & mortar into curating an equally large online presence. Considering its household name status and its sheer ability to bring in truckloads of revenue, Walmart will continue to grace us with its discounts for many years to come.
The bull and bear case for Etsy
If you thought Etsy (NASDAQ: ETSY) was popular before the pandemic, then you ain’t seen nothing yet. Yes, Etsy was a well-known brand, with plenty of potential in the e-commerce space, but, it really boomed this year. Etsy became the go-to business to find home-made and locally sourced masks. In fact, Etsy sold about $133 million worth of artisan masks, with around 12 million of them in April alone.
Etsy has stolen the show this year as it caters to the current market trends of home-grown, local, artisan, and vegan. Beyond the mask boom, sales grew 93% by its Q2 earnings driven by sales in homewares and home furnishings; craft supplies; and beauty and personal care. For the third-quarter, total revenue was up by 128.1% to $451.5 million. Etsy is growing at an explosive rate with many small businesses utilizing its services as an alternative to Amazon.
However, this growth might not be sustainable once pandemic-related restrictions ease. With regards to shopping local, many will prefer to slip back into the local brick-and-mortar stores that fill up our towns and suburbs.
As for the sellers, there has been backlash this year against Etsy’s mandatory changes to the service, such as automatically advertising products without the prior consent of the seller. For small businesses, this represents a move away from helping small companies to instead creating a slurry of unforeseen costs that could seriously affect the margins of their businesses.
However, for investors, Etsy is currently a buy right now as an asset-light business with high gross margins that came in at just under $1 billion for the twelve months ending September, an increase of 90% YoY.
So, which should I watch?
Both of these stocks present a good option. Walmart is the giant of these two choices, although it might struggle to grow further due to both competition and the sheer size of the company, it has really been making tracks by building up a digital alternative to its brick-and-mortar stores. Walmart is a company that will not stop, it is a good trusty stock to have in your portfolio.
Etsy on the other hand is perfect for the investor who wants high, fast growth and who isn’t averse to a little risk. This company could go far, but it needs to be able to sustain its continued growth along the way.
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TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
