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The Best E-Commerce Stock Is Not Amazon

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by , 02-08-2016 at 07:33 AM (1268 Views)
      
   
If you think you’re too late to profit from e-commerce bonanza, think again.

Because even though the first web-based purchase was made more than 20 years ago, online shopping is still growing at a breathtaking pace, with a 15% expansion in 2015 alone.

But despite that fast growth, web-based purchases only made up 7.4% of total US retail sales in the third quarter, according to the Census Bureau, so the trend has plenty of room to run yet.

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Of Picks, Shovels and Clicks

When most people think of e-commerce, the first name that leaps to mind is Amazon.com (AMZN). There’s good reason for that: according to Macquarie Research, the retail giant accounted for more than half of all e-commerce growth last year.

Put another way, of every extra dollar Americans spent online in 2015, $0.51 went to Amazon. But be that as it may, Amazon, with its razor-thin profit margins, lack of a dividend and nosebleed P/E ratio of 426, is far from my favorite way to play this trend.

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