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E-commerce grew by leaps and bounds over the past year and a half as shoppers worldwide hunkered down during the pandemic. But even with the reopening of economies the sector still has a ton of runway ahead of it, driven by tech advances in areas like AI and big data, video and voice communication, all of which are set to make online platforms more personalized and more responsive and give companies more access to customers. Who’s leading the e-commerce charge? Investors willing to look past the big names like Amazon and Shopify have a wealth of options in front of them. Here, Cantech gives you three, all with Buy ratings from analysts and in no particular order. First up is mdf commerce (mdf commerce Stock Quote, Charts, News, Analysts, Financials TSX:MDF), a Montreal-based e-commerce solutions company that offers procurement and publishing solutions and online marketplaces for a number of verticals including automotive, IT and telecom and electronics. The former Mediagrif Interactive Technologies went about a shift in positioning last year in response to the growing demand for its SaaS-based offerings on strategic sourcing, supply chain collaboration and e-marketplace solutions. But while the company saw its share price rise sharply last year, 2021 has been a different story with the stock currently down about 40 per cent. That downturn has coincided with mdf’s blockbuster acquisition of Periscope Intermediate for $264 million, a deal which Laurentian Bank Securities analyst Nick Agostino says will be one to watch as mdf moves forward. (All figures in Canadian dollars except where noted otherwise.) “Rarely do we see companies acquire another of a similar scale,” said Agostino in a September 2 report to clients. “We believe investors will need a longer-term focus to fully realize the benefits from this sizeable deal, given its short-term dilutive nature. Given this, and MDF competing in a highly fragmented strategic sourcing market, we put the onus on MDF to show it can successfully integrate, deliver and unlock value with the combined entity; we however acknowledge the opportune deal timing given the potential passing of the US$1T infrastructure bill in October.” In his report, Agostino reviewed mdf’s latest quarterly numbers, which the analyst said were below expectations on the top and bottom lines. Nonetheless, Agostino remains positive on the stock, maintaining a “Buy” rating while lowering his target from $17.00 to $11.00 on share dilution related to the Periscope purchase. The new target represented a projected return of 41.9 per cent. (All returns are at the time the analyst’s report was published.) Next up is Nuvei Corp (Nuvei Stock Quote, Charts, News, Analysts, Financials TSX:NVEI), another Montreal-based company which offers payments solutions for merchants and partners around the globe. Nuvei has some major clients in its stable, including Salesforce Commerce Cloud, which signed up Nuvei as its payment solutions provider. That kind of cred is worthy of celebrating, according to National Bank analyst Richard Tse, who delivered an update to clients on Nuvei on August 10. “In our view, the recent announcement that Nuvei is an official payment solutions provider for Salesforce Commerce Cloud is positive not just for the potential revenue contribution of such partnership but also in terms of validating Nuvei’s offering, the importance of which cannot be understated as the Company looks to scale its brand more aggressively,” Tse wrote. With his update, Tse reviewed Nuvei’s latest quarterly financials and said the company’s Q2 was better than expected, with revenue up 114 per cent year-over-year and adjusted EBITDA at US$79.4 million compared to the analyst’s estimate of US$68.1 million. “We think the Company is just scratching the surface given its meaningful breadth – from products, verticals, to geographic markets,” Tse said. “Given the better than expected execution to date, it’s not surprising why Nuvei is also filing to list its shares on the NASDAQ – an event we think will broaden the brand and investor base.” In his report, Tse reiterated his “Outperform” rating on NVEI while upping his target from $120.00 to $150.00, representing a projected one-year return of 27.1 per cent. So far in 2021, NVEI is up a huge 103 per cent. Last is a newer name, JustKitchen Holdings (JustKitchen Stock Quote, Charts, News, Analysts, Financials TSXV:JK), a business that caters to the food delivery market and operates a hub and spoke model where food is prepared in the hub and then sent out to the spokes for final prep and packing. The company just opened its first ghost kitchen in Taiwan less than a year ago, and its early numbers are impressive, according to Beacon Securities analyst Doug Cooper, who updated clients on JK in a September 2 report. Cooper said demographic changes bode well for JustKitchen, with delivery and take-out meals growing 300 per cent faster than dine-in, even prior to the pandemic. “The Q3/FY21 results showed an acceleration in the company’s growth,” Cooper wrote. “Q2 sales were +16 per cent versus Q1 while Q3 revenue was +50 per cent versus Q2. Given the number of spokes that have been opened, we believe the company is on-track to reach our FY21 revenue forecast of $12.7 million.” Cooper said he anticipates JustKitchen will expand into other geographies but at present he hasn’t factored that expansion into his current model, which involves a maintained “Buy” rating and $3.40 target, which translates to projected return of 121 per cent.

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