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Guess the stocks Ep. 5: What marks the competitive edge for E-commerce companies?

Guess the stocks Ep. 5: What marks the competitive edge for E-commerce companies?
E-commerce stocks have gain a lot of attention these years, especially with some popular stocks' price skyrocketing. But this market has transformed from a "blue ocean" 20 years ago, to a highly competitive market today. So how do we tell if an e-commerce company is winning more market shares over its competitors?
Sales expense ratio, the percentage of marketing expenses on total revenue, might be the key indicator. We focus mainly on the trend of this index. An increasing trend means that the company is spending relatively more money on sales and marketing, but gaining relatively less revenue. It can indicate a disadvantage. Conversely, a declining sales expense ratio trend might suggest higher competitiveness.
Guess the stocks Ep. 5: What marks the competitive edge for E-commerce companies?
In the graph we can see clearly that company A has a downward sloping sales expense ratio, indicating that company A has competitive edge over the past two years. But the 2024 Q3 results reported a flat trend. The remaining companies have more flat curves on sales expense ratio, whereas company B shows a slightly upward sloping trend.
Challenge Starts here>>
Can this theory be tested? Let's look at their revenue growth. Get ready, the question comes later!
Guess the stocks Ep. 5: What marks the competitive edge for E-commerce companies?
Questions:
1) Which company do Company A, Company B, Company C and Company D refer to, respectively?
2) Which one of these e-commerce companies has performed worst in the last two years, and briefly talk about why this company's stock price has underperformed.
Rewards:
An equal share of 5000 points: All mooers who correctly answer question 1 and give a reasonable answer to question 2 will get an equal share of 5000 points. (e.g., If 100 mooers answer correctly, each mooer will get 50 points.)
Hint:
Company A: It is a Chinese online retailer with a focus on the traditional agriculture industry. This company also operates an international platform tha offers heavily discounted consumer goods which are mostly shipped directly from China.
Company B: It is an American multinational e-commerce company based in San Jose, California, that allows users to buy or view items via retail sales through online marketplaces and websites in 190 markets worldwide. It was one of the first companies to create and market an Internet website to match buyers and sellers of goods and services.
Company C: It is a Chinese e-commerce company headquartered in Beijing, one of company A's major competitors. With revenues more than $152.8 billion in 2023, this company is China’s largest retailer by revenue, and ranks 52 on 2023‘s Fortune Global 500.
Company D: It is an American multinational technology company, engaged in e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence. This company ranks top 10 on 2023's Fortune Global 500.
Source: Stock Compare Feature on moomoo App
Source: Stock Compare Feature on moomoo App
For the introduction for stock compare feature, please tap here and learn more>>
How to participate?
Drop your answers in the comment section below! Please answer all the questions!
Note: Only original submissions will be considered. Plagiarized content leads to disqualification from the event.
Event time:
Now till 16 September, 2024, 23:00 ET
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only. Read more
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