10 Best E Commerce Software for February 2026
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Market Overview & Selection Criteria
The e-commerce software sector continues to drive digital transformation, with companies enabling online storefronts, payments, and supply chain efficiency amid rising global online retail. ValueSense analysis highlights stocks where intrinsic value significantly exceeds current pricing, indicating potential undervaluation based on fundamentals like revenue growth, free cash flow (FCF) margins, and return on invested capital (ROIC). These top 10 stock picks were selected using ValueSense's proprietary quality ratings (scale of 1-10), prioritizing high ROIC, strong gross margins, and positive FCF generation, while focusing on e-commerce enablers from platforms to fraud prevention tools. Metrics such as market cap, revenue growth, and debt-to-equity provide a balanced view for stock watchlist consideration, emphasizing diversified opportunities in this high-growth niche.
Featured Stock Analysis
Stock #1: Shopify Inc. (SHOP)
| Metric | Value |
|---|---|
| Market Cap | $175.4B |
| Quality Rating | 7.3 |
| Intrinsic Value | $26.9 |
| 1Y Return | 10.1% |
| Revenue | $10.7B |
| Free Cash Flow | $1,910.9M |
| Revenue Growth | 30.3% |
| FCF margin | 17.9% |
| Gross margin | 48.7% |
| ROIC | 57.9% |
| Total Debt to Equity | 8.9% |
Investment Thesis
Shopify Inc. (SHOP) stands out as a leading e-commerce platform with a market cap of $175.4B, showcasing robust financials including $10.7B in revenue and $1,910.9M in free cash flow. Its quality rating of 7.3 reflects strong operational efficiency, with an impressive ROIC of 57.9% and revenue growth of 30.3%. The intrinsic value of $26.9 suggests significant undervaluation relative to growth potential, supported by a healthy FCF margin of 17.9% and gross margin of 48.7%. Despite a modest 1Y return of 10.1%, low total debt to equity at 8.9% positions SHOP for sustained expansion in the competitive e-commerce software landscape. This analysis underscores SHOP's capacity to generate superior returns through scalable platform adoption.
Key Catalysts
- Exceptional ROIC at 57.9%, indicating efficient capital use for long-term value creation.
- Strong revenue growth of 30.3%, driven by expanding merchant base and ecosystem tools.
- High FCF of $1,910.9M with 17.9% margin, providing flexibility for innovation and buybacks.
Risk Factors
- Large market cap $175.4B may limit explosive upside compared to smaller peers.
- Moderate 1Y return 10.1% amid broader market volatility in tech stocks.
- Competitive pressures in e-commerce platforms could impact market share.
Stock #2: GoDaddy Inc. (GDDY)
| Metric | Value |
|---|---|
| Market Cap | $13.6B |
| Quality Rating | 7.0 |
| Intrinsic Value | $183.0 |
| 1Y Return | -52.9% |
| Revenue | $4,869.8M |
| Free Cash Flow | $1,537.9M |
| Revenue Growth | 8.8% |
| FCF margin | 31.6% |
| Gross margin | 61.5% |
| ROIC | 19.4% |
| Total Debt to Equity | 4,193.5% |
Investment Thesis
GoDaddy Inc. (GDDY), with a market cap of $13.6B, offers compelling value in domain and website services integral to e-commerce setups. ValueSense assigns a quality rating of 7.0, backed by $4,869.8M revenue, $1,537.9M FCF, and superior gross margin of 61.5%. The intrinsic value of $183.0 highlights deep undervaluation, even with a challenging 1Y return of -52.9% and elevated total debt to equity at 4,193.5%. Steady revenue growth of 8.8% and FCF margin of 31.6% demonstrate profitability, while ROIC of 19.4% signals effective resource allocation. This positions GDDY as an educational case for recovery potential in foundational e-commerce infrastructure.
Key Catalysts
- Outstanding FCF margin 31.6% and gross margin 61.5% for cash generation.
- Intrinsic value $183.0 far exceeds implied pricing, suggesting upside.
- ROIC of 19.4% supports ongoing domain and hosting expansions.
Risk Factors
- High total debt to equity 4,193.5% raises leverage concerns in rate-sensitive environments.
- Negative 1Y return -52.9% reflects recent market headwinds.
- Slower revenue growth 8.8% versus high-growth peers.
Stock #3: The Hanover Insurance Group, Inc. (THG)
| Metric | Value |
|---|---|
| Market Cap | $6,159.4M |
| Quality Rating | 6.3 |
| Intrinsic Value | $418.4 |
| 1Y Return | 14.2% |
| Revenue | $6,483.1M |
| Free Cash Flow | $1,003.9M |
| Revenue Growth | 5.1% |
| FCF margin | 15.5% |
| Gross margin | 23.3% |
| ROIC | 20.6% |
| Total Debt to Equity | 37.4% |
Investment Thesis
The Hanover Insurance Group, Inc. (THG) brings stability to e-commerce-related risk management with a market cap of $6,159.4M and quality rating of 6.3. Key metrics include $6,483.1M revenue, $1,003.9M FCF, and intrinsic value of $418.4, pointing to undervaluation. Positive 1Y return of 14.2% contrasts with modest revenue growth of 5.1%, bolstered by ROIC of 20.6% and FCF margin of 15.5%. Total debt to equity at 37.4% is manageable, while gross margin of 23.3% reflects insurance sector norms. THG's analysis illustrates diversification benefits for e-commerce portfolios needing protective layers.
Key Catalysts
- Strong ROIC 20.6% and positive 1Y return 14.2% for steady performance.
- Substantial intrinsic value $418.4 indicates margin of safety.
- Solid FCF $1,003.9M supports dividend potential and resilience.
Risk Factors
- Lower quality rating 6.3 compared to tech-focused peers.
- Modest revenue growth 5.1% limits aggressive expansion narrative.
- Gross margin 23.3% vulnerable to claims cycles in insurance.
Stock #4: Wix.com Ltd. (WIX)
| Metric | Value |
|---|---|
| Market Cap | $4,806.0M |
| Quality Rating | 7.3 |
| Intrinsic Value | $335.3 |
| 1Y Return | -64.1% |
| Revenue | $1,929.2M |
| Free Cash Flow | $568.9M |
| Revenue Growth | 13.2% |
| FCF margin | 29.5% |
| Gross margin | 68.4% |
| ROIC | 21.0% |
| Total Debt to Equity | (563.6%) |
Investment Thesis
Wix.com Ltd. (WIX) empowers e-commerce site building with market cap $4,806.0M and quality rating 7.3. Financials feature $1,929.2M revenue, $568.9M FCF, and intrinsic value $335.3, signaling strong undervaluation despite -64.1% 1Y return. Revenue growth of 13.2%, FCF margin 29.5%, and top-tier gross margin 68.4% highlight efficiency, with ROIC at 21.0%. Negative total debt to equity -563.6% indicates net cash position, making WIX a prime example of high-margin software scalability in website creation tools.
Key Catalysts
- Exceptional gross margin 68.4% and FCF margin 29.5% for profitability.
- High intrinsic value $335.3 versus recent price weakness.
- ROIC 21.0% drives user monetization growth.
Risk Factors
- Sharp 1Y return decline -64.1% signals volatility.
- Negative debt to equity may reflect aggressive cash deployment risks.
- Competition in no-code platforms could pressure growth.
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Stock #5: SPS Commerce, Inc. (SPSC)
| Metric | Value |
|---|---|
| Market Cap | $3,317.5M |
| Quality Rating | 6.8 |
| Intrinsic Value | $119.5 |
| 1Y Return | -51.3% |
| Revenue | $729.8M |
| Free Cash Flow | $148.4M |
| Revenue Growth | 19.3% |
| FCF margin | 20.3% |
| Gross margin | 68.4% |
| ROIC | 9.2% |
| Total Debt to Equity | 1.0% |
Investment Thesis
SPS Commerce, Inc. (SPSC) specializes in supply chain tech for e-commerce, holding market cap $3,317.5M and quality rating 6.8. It reports $729.8M revenue, $148.4M FCF, with intrinsic value $119.5 amid -51.3% 1Y return. Revenue growth 19.3%, FCF margin 20.3%, and gross margin 68.4% underscore strength, complemented by low total debt to equity 1.0%. ROIC of 9.2% suggests improvement potential, positioning SPSC as a steady enabler in e-commerce logistics networks.
Key Catalysts
- Healthy revenue growth 19.3% in supply chain software demand.
- Minimal debt to equity 1.0% for financial flexibility.
- Strong gross margin 68.4% supports scaling.
Risk Factors
- Negative 1Y return -51.3% indicates short-term pressures.
- Lower ROIC 9.2% versus category leaders.
- Dependence on retailer adoption cycles.
Stock #6: KAR Auction Services, Inc. (KAR)
| Metric | Value |
|---|---|
| Market Cap | $3,191.4M |
| Quality Rating | 5.9 |
| Intrinsic Value | $12.9 |
| 1Y Return | 43.5% |
| Revenue | $1,895.2M |
| Free Cash Flow | $186.8M |
| Revenue Growth | 12.3% |
| FCF margin | 9.9% |
| Gross margin | 45.3% |
| ROIC | 11.6% |
| Total Debt to Equity | (2.1%) |
Investment Thesis
KAR Auction Services, Inc. (KAR) supports e-commerce adjacent auto auctions with market cap $3,191.4M and quality rating 5.9. Metrics include $1,895.2M revenue, $186.8M FCF, and intrinsic value $12.9, with standout 43.5% 1Y return. Revenue growth 12.3%, FCF margin 9.9%, gross margin 45.3%, and ROIC 11.6% provide balance, aided by negative total debt to equity -2.1%. KAR exemplifies value in niche marketplaces bridging physical-digital commerce.
Key Catalysts
- Strong 1Y return 43.5% amid auction digitization.
- Intrinsic value $12.9 offers entry point.
- Net cash position via negative debt to equity.
Risk Factors
- Lower quality rating 5.9 reflects operational challenges.
- Modest FCF margin 9.9% limits aggressive growth.
- Cyclical auto market exposure.
Stock #7: Oddity Tech Ltd. (ODD)
| Metric | Value |
|---|---|
| Market Cap | $1,900.9M |
| Quality Rating | 7.1 |
| Intrinsic Value | $74.0 |
| 1Y Return | -29.9% |
| Revenue | $780.8M |
| Free Cash Flow | $102.1M |
| Revenue Growth | 97.7% |
| FCF margin | 13.1% |
| Gross margin | 73.1% |
| ROIC | 51.9% |
| Total Debt to Equity | 6.3% |
Investment Thesis
Oddity Tech Ltd. (ODD) leverages AI for e-commerce beauty personalization, with market cap $1,900.9M and high quality rating 7.1. It boasts $780.8M revenue, $102.1M FCF, and intrinsic value $74.0 despite -29.9% 1Y return. Explosive revenue growth 97.7%, ROIC 51.9%, gross margin 73.1%, and low total debt to equity 6.3% highlight disruptive potential, with FCF margin 13.1% adding credibility.
Key Catalysts
- Phenomenal revenue growth 97.7% from AI-driven sales.
- Top ROIC 51.9% for tech efficiency.
- Attractive intrinsic value $74.0.
Risk Factors
- Recent 1Y decline -29.9% post-hype.
- Early-stage scaling risks in beauty tech.
- Competition from larger platforms.
Stock #8: GigaCloud Technology Inc. (GCT)
| Metric | Value |
|---|---|
| Market Cap | $1,510.5M |
| Quality Rating | 7.5 |
| Intrinsic Value | $131.9 |
| 1Y Return | 75.8% |
| Revenue | $1,222.9M |
| Free Cash Flow | $188.1M |
| Revenue Growth | 10.2% |
| FCF margin | 15.4% |
| Gross margin | 23.1% |
| ROIC | 21.3% |
| Total Debt to Equity | 101.0% |
Investment Thesis
GigaCloud Technology Inc. (GCT) facilitates B2B e-commerce marketplaces with market cap $1,510.5M and leading quality rating 7.5. Financials show $1,222.9M revenue, $188.1M FCF, intrinsic value $131.9, and impressive 75.8% 1Y return. ROIC 21.3%, FCF margin 15.4%, but lower gross margin 23.1% and total debt to equity 101.0% reflect marketplace dynamics and revenue growth 10.2%.
Key Catalysts
- Stellar 1Y return 75.8% on B2B momentum.
- High quality rating 7.5 and intrinsic value $131.9.
- Robust ROIC 21.3%.
Risk Factors
- Elevated debt to equity 101.0% in growth phase.
- Thin gross margin 23.1%.
- Marketplace competition intensity.
Stock #9: Riskified Ltd. (RSKD)
| Metric | Value |
|---|---|
| Market Cap | $665.9M |
| Quality Rating | 5.2 |
| Intrinsic Value | $11.2 |
| 1Y Return | -17.9% |
| Revenue | $338.8M |
| Free Cash Flow | $32.9M |
| Revenue Growth | 6.5% |
| FCF margin | 9.7% |
| Gross margin | 50.2% |
| ROIC | (78.5%) |
| Total Debt to Equity | 8.1% |
Investment Thesis
Riskified Ltd. (RSKD) provides fraud prevention for e-commerce, market cap $665.9M, quality rating 5.2. It has $338.8M revenue, $32.9M FCF, intrinsic value $11.2, and -17.9% 1Y return. Revenue growth 6.5%, FCF margin 9.7%, gross margin 50.2%, but negative ROIC -78.5% and total debt to equity 8.1% warrant scrutiny in this specialized niche.
Key Catalysts
- Positive FCF $32.9M in fraud tech demand.
- Gross margin 50.2% for software purity.
- E-commerce security tailwinds.
Risk Factors
- Negative ROIC -78.5% signals capital inefficiency.
- Lower quality rating 5.2.
- Muted revenue growth 6.5%.
Stock #10: Rezolve AI PLC (RZLV)
| Metric | Value |
|---|---|
| Market Cap | $613.5M |
| Quality Rating | 10.0 |
| Intrinsic Value | $3.9 |
| 1Y Return | 0.8% |
| Revenue | $6,451.3K |
| Free Cash Flow | ($36.6M) |
| Revenue Growth | N/A |
| FCF margin | (568.0%) |
| Gross margin | 95.4% |
| ROIC | (470.8%) |
| Total Debt to Equity | (248.8%) |
Investment Thesis
Rezolve AI PLC (RZLV), market cap $613.5M, boasts perfect quality rating 10.0 but shows early-stage challenges with $6,451.3K revenue, negative $36.6M FCF, and intrinsic value $3.9. 1Y return 0.8%, FCF margin -568.0%, gross margin 95.4%, extreme negative ROIC -470.8%, and total debt to equity -248.8% frame it as high-risk/high-reward AI play in e-commerce personalization.
Key Catalysts
- Top quality rating 10.0 for AI innovation.
- Ultra-high gross margin 95.4%.
- Net cash via negative debt to equity.
Risk Factors
- Negative FCF -$36.6M and ROIC -470.8%.
- Tiny revenue base $6,451.3K with N/A growth.
- Extreme losses signal pre-profit stage.
Portfolio Diversification Insights
These 10 e-commerce software stocks cluster into platforms (SHOP, GDDY, WIX), supply chain/logistics (SPSC, GCT, KAR), AI/niche tech (ODD, RZLV, RSKD), and adjacents (THG), offering sector balance within tech. Larger caps like SHOP provide stability (high ROIC, low debt), while mid/small caps (ODD, GCT) add growth via revenue surges (97.7%, 75.8% 1Y). Allocate 40% to platforms, 30% logistics, 20% AI, 10% insurance for risk spread; cross-references like SHOP-WIX synergy in merchant tools and RSKD's fraud layer for GCT enhance portfolio cohesion, reducing concentration in any subsector.
Market Timing & Entry Strategies
Consider entry during e-commerce sector dips, targeting stocks with intrinsic value >2x implied price (e.g., GDDY, WIX) for margin of safety. Monitor Q4 holiday ramps for revenue catalysts in SHOP/ODD, or rate cuts easing debt burdens (GCT). Dollar-cost average into high-quality ratings (7+ like GCT 7.5, SHOP 7.3) over 3-6 months, pairing with broader market pullbacks. Use FCF positivity as confirmation, avoiding overexposure to negative ROIC names (RSKD, RZLV) without volume upticks.
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FAQ Section
How were these stocks selected?
These top 10 stock picks were chosen via ValueSense methodology emphasizing intrinsic value, quality ratings, high ROIC, FCF margins, and e-commerce software relevance for diversified investment opportunities.
What's the best stock from this list?
GigaCloud Technology (GCT) leads with 7.5 quality rating, 75.8% 1Y return, and $131.9 intrinsic value, balancing growth and fundamentals in B2B e-commerce.
Should I buy all these stocks or diversify?
Diversify across platforms, logistics, and AI subsets to mitigate risks like debt (GDDY) or negative FCF (RZLV), leveraging complementary exposures for balanced stock watchlist.
What are the biggest risks with these picks?
Key concerns include high debt (GDDY 4,193.5%, GCT 101.0%), negative returns (WIX -64.1%), and profitability gaps (RZLV -568.0% FCF margin), alongside sector competition.
When is the best time to invest in these stocks?
Optimal during market corrections highlighting intrinsic value discounts, Q4 e-commerce peaks, or when revenue growth catalysts align with improving ROIC trends.