2 Top E-Commerce Stocks to Buy on the TSX Today

Shopping and e-commerce

If the recent big selloff in the Canadian stock market has made you nervous, you’re not alone. The TSX Composite has seen more than 4% value erosion in the last month. Although it’s natural to be worried about your investments amid turbulent markets, especially if you’re new to stock investing, you should always maintain a long-term perspective to get healthy returns on investments. In fact, temporary downward market corrections give you an opportunity to buy some quality growth stocks at a bargain, which increases your chances of winning.

In this article, I’ll highlight two top Canadian e-commerce stocks you can buy on the TSX today and hold for the long term to expect strong returns on your investments.

Shopify stock

When we talk about e-commerce stocks listed on the TSX today, Shopify (TSX:SHOP) is the first name that pops into the minds of most investors. Despite being one of the most popular e-commerce platform providers worldwide, SHOP stock hasn’t seen the appreciation that it deserves lately, which makes it look undervalued right now.

The Canadian e-commerce giant currently has a market cap of $91.2 billion, as its stock trades at $71.10 per share with 51.2% year-to-date gains. However, SHOP stock has seen about 21% value erosion in the last three months due mainly to an uncertain macroeconomic environment.

Despite slowing economic growth and high inflationary pressures, Shopify is continuing to maintain strong top-line growth in 2023. In the first half of the year, its total revenue rose 28.1% YoY (year over year) to US$3.2 billion, as its merchant solutions and gross payment volume continued to soar. For the full year 2023, the e-commerce company expects its revenue to grow at a low-20s percentage rate, while it expects the gross margin to improve by two to three percentage points with no major increases expected in its operating expense.

Shopify’s financial growth trends can see a significant improvement in the long run as the digital commerce boom is far from over yet, which should drive the demand for its innovative and regularly updated services higher.

Nuvei stock

Nuvei (TSX:NVEI) is another beaten-down TSX stock to consider today. Unlike Shopify, Nuvei is not an e-commerce platform provider. Instead, the company focuses on providing electronic payment solutions to merchants globally, making its business highly linked to e-commerce trends.

After losing 58% of its value in 2022, NVEI stock has extended its losses by more than 38% so far this year, making this e-commerce stock look cheap to buy for the long term. With this, the stock currently trades at $21.26 per share with a $3 billion market cap.

Even as macroeconomic concerns are forcing businesses globally to cut their unnecessary expenses, a strong 32.3% YoY increase in Nuvei’s sales in the first half of 2023 reflects the strong demand for its payment services. As economic uncertainties gradually subside in the future, you can expect the demand to soar further, which should accelerate Nuvei’s financial growth and help its share prices recover fast.

The post 2 Top E-Commerce Stocks to Buy on the TSX Today appeared first on The Motley Fool Canada.

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The Motley Fool has positions in and recommends Nuvei and Shopify. The Motley Fool has a disclosure policy. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.