There's a new e-commerce kid on the block named BigCommerce BIGC. Based in Austin and fresh out of an August IPO, I bought shares last week under $70 because I liked the risk/reward near all-time lows vs. its "initial public mania" that sent shares to $160.
While the acceleration of digital work-and-shop from home trends ignited by the coronavirus pandemic caused big peer Shopify SHOP to rally over 150% this year, BIGC remained on the sidelines as concerns about its ability to compete outweighed its better valuation (26 times forward sales of $175 million when I bought shares last week).
After BIGC earnings on Nov 5, Wedbush highlighted the growth story expanding beyond established enterprise customers like Ben&Jerry's and Skullcandy...
"BigCommerce's subscription revenue growth accelerated to +26% as customers rolled off 90 day free trials, and partner and service revenue saw the benefit of strong GMV coming through the platform, leading to 82% revenue growth for that segment."
Why I Own Both SHOP and BIGC
In the video that accompanies this article, I go over the valuations of both companies and explain why I own both.
Plus, I detail the buying decisions I made for both, including SHOP's partnership with Alibaba's BABA Alipay and a slew of good fundamental news for BigCommerce even as it sat depressed under $70 in mid-November.
I cover all these provocative points on the BIGC...
Who is Truist and why do they have a $95 price target?
What open-source checkout innovation did BIGC unveil recently that really got shares rocking?
Who tried to buy BIGC before the IPO for $1.5 billion?
Why did a 5 million share offering at $68 two weeks ago help put the bottom in?
What big fund manager bought 1.35 million shares at much higher prices in Q3?
And how a little FinTech partnership may be following the playbook of Square SQ.
As I said to my TAZR Trader members recently...
This is music to my FinTech ears for the same reasons we love Square -- SaaS that seamlessly serves the small business person so they can focus their time and energy on selling, not on bookkeeping.
I also share which big fund manager made SHOP his top position in Q3.
While the king of e-commerce, Amazon AMZN, sits near $3,100 and all investors wonder how long they have to wait for new highs above $3,500, I'm busy looking for alpha in the upstarts who have much more to gain in the globally expanding e-comm pie.
Be sure to watch the video for all the answers.
Disclosure: I own shares of BABA, SHOP, BIGC and SQ for the Zacks TAZR Trader portfolio.
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BigCommerce Holdings, Inc. (BIGC) : Free Stock Analysis Report
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