We've come a long way since Amazon.com sold its first book over the internet almost 26 years ago. Today, you can order just about anything online, from an expensive flat panel television to a lump of coal (yes really, I've done it). But in a lot of ways, e-commerce is just getting started. Global online purchases accounted for just 14% of total retail sales last year and consumers are only now starting to get comfortable buying personal or expensive items such as clothes and cars over the internet.

A significant portion of my portfolio (40%-plus) is made up of seven growth stocks that will benefit from e-commerce tailwinds. Let's look at these quality operators and why they could help fund my retirement a decade from now.

My e-commerce basket of seven stocks

Shopify is my largest holding, but it's not the stock I've owned the longest. My position in Amazon goes back to 2012 and I've held MercadoLibre since 2013. All of the other positions have been purchased within the last four years, with Sea Limited being my most recent addition within the last couple of weeks. I've not sold shares of any of the stocks listed in the table below except Amazon (don't worry, I'll explain why later).

Company

% of My Portfolio

Market Capitalization

TTM Revenue

MRQ Revenue Growth

P/S Ratio

Shopify (NYSE:SHOP)

12.7%

$90.4 billion

$1.7 billion

47%

51

MercadoLibre (NASDAQ:MELI)

12.6%

$41.5 billion

$2.5 billion

38%

17

Square (NYSE:SQ)

4.7%

$35.5 billion

$5.1 billion

44%

7.4

Stitch Fix (NASDAQ:SFIX)

4.4%

$2.5 billion

$1.7 billion

22%

1.5

JD.com (NASDAQ:JD)

3.6%

$77.3 billion

$85 billion

21%

0.9

Amazon.com (NASDAQ:AMZN)

1.7%

$1.22 trillion

$296.3 billion

26%

4.1

Sea Limited (NYSE:SE)

1%

$36.8 billion

$2.5 billion

103%

14

Total / Average

40.7%

$214.6 billion

$56.4 billion

43%

13.7

Data source: Yahoo! Finance as of May 29, 2020. TTM = Trailing 12 months. MRQ = most recent quarter. P/S= price to sales.

Aside from the trillion-dollar-plus market cap juggernaut, the average market capitalization is $47.3 billion. Five of the seven have trailing-12-month revenues less than or equal to $5.1 billion, putting them just outside of this year's Fortune 500 list. Revenue growth is solid across the board, but the price-to-sales ratios seem to be all over the map. Stitch Fix and JD.com are the only stocks that have P/S ratios below the market average of 2.15.

Let's take a closer look at each of these companies.

Providing small businesses with online operating systems

Shopify was started to help entrepreneurs sell goods over the internet. Square was founded to enable small business owners to collect credit card payments in person. But now, both have now branched out and have a suite of tools that enable entrepreneurs to run their entire businesses and make sales online or in person. Although Square only recently started its push into e-commerce, it's rapidly building a robust online capability. In the last several months it's released a curbside pickup and delivery feature that's been eagerly embraced by its brick-and-mortar retailers, who have used the option to transact an amazing $59 million in gross payments per week (or ~$3 billion annualized).

Both companies have tapped less than 4% of their estimated addressable markets, giving them a tremendous runway of growth ahead, even if they compete for some of the same sellers.

E-commerce boxes on doorstep with shipping labels.

Image source: Getty Images.

Regional gems serve large fast-growing markets

E-commerce provides a treasure trove of opportunity for international investors. China leads the world in e-commerce adoption with almost 40% of retail sales completed online. But even at that elevated level, online spend is still expected to grow 24% this year. Latin America and Southeast Asia are only seeing single-digit penetration of e-commerce, but the growth rates are impressive at over 20% and 30% respectively.

Company

Region
Served

Region's
Population

Region's
Internet Users

Region's E-Commerce Sales
as % of Total Retail

JD.com

China

1.4 billion

903 million

37%

MercadoLibre

Latin America

638 million

362 million

4.2%

Sea Limited

Southeast Asia

662 million

416 million

2.4%

Data sources: Worldometers, Statista, Emarketer, and Datareportal.

In addition to the tremendous e-commerce opportunity ahead for these three proven e-commerce specialists, each of them has an expansive business that goes beyond just the basic online fulfillment. JD.com has a thriving grocery and pharmacy delivery business, MercadoLibre has a fast-growing payments platform, and Sea Limited has a popular video game segment in addition to a robust payments business. This optionality gives investors more reasons to consider this trio.

Don't count out this personalized clothing e-tailer

Stitch Fix supplies clothing items via e-commerce, but with a twist. Its customers, referred to as clients, request a shipment and a stylist selects a "fix" of five items based on a detailed personal data profile and the aid of data-science-driven algorithms. Clients try on the items and only pay for the ones they keep. Over 3.5 million customers purchased $1.7 billion in clothing and accessories this way over the past 12 months.

This disruptive approach is working to capture a larger portion of the $329 billion of merchandise sold in brick-and-mortar clothing shops in the U.S. and the U.K.

Online bookseller turned e-commerce giant and more

Between Amazon's e-commerce domination, its innovative track record, and significant optionality, it's hard to ignore this multi-faceted business as an investor. Amazon should be a market-beating stock over the next decade, but I've reduced my position because of some cracks in its armor around questionable practices, government scrutiny, and the challenges of being a huge company.

The bottom line for e-commerce

E-commerce is here to stay and it's still a great way for investors to profit over the long run. These seven companies are not the only ways to play this incredible trend, but this basket of founder-led high-growth online operators should provide shareholders multibagger returns over the next 10 years. My retirement could depend on it.