E-commerce stocks have been among the strongest performers of the year. The combination of brick-and-mortar bankruptcies plus a projected 32.4% compounded annual growth for the space through 2024 provides quite the compelling backdrop.

Several stocks within the space have understandably responded extremely positively, racing to all-time highs on impressive results and rosy forecasts. Conversely, Revolve Group (NYSE:RVLV) has not enjoyed that kind of stock success, yet offers investors a strong option to participate in this promising long-term theme.

A pile of boxes at a front door.

Image source: Getty Images.

Revolve Group

Revolve Group is a digitally native fashion retailer catering to Generation Z and Millennials. It offers a plethora of owned-brands -- as well as third-party brands -- on its websites. The company uses social media influencers all over the world to connect consumers to its products, and also advertises heavily at music festivals and other live events.

With COVID-19 halting the gatherings Revolve has relied on for marketing, it's no wonder why this e-commerce play has lagged many of the others in its space. Fortunately for shareholders, sound operational management enabled the company to weather the storm.

Revolve uses its own, customized technology platform to automate and map its inventory trends in real time. This allows the company to create and order products based on the actual demand for those products, and that mitigates the risk of inventory gluts. This innovative approach to operations fostered the company's "fastest quarterly inventory turns in 6 years, during the most challenging economic climate in decades" from April through June.

Some encouraging signs 

Pandemic and all, Revolve's clinical approach to operations powered the company to record earnings and operating cash flow this past quarter. This is despite sales shrinking by 12%, year over year, in response to cancellation of live events -- where Revolve does the bulk of its marketing.

Speaking of which -- in light of live events being shut down -- Revolve co-CEOs Michael Karanikolas and Michael Mente aggressively shifted marketing spend online. The company has increasingly utilized its army of influencers and its social media presence (already in place) to grow revenues.

It seems to be starting to work. Net sales returned to positive year-over-year growth for the month of June, the first time since the onset of the COVID-19 pandemic, and the company is ramping up inventory purchases to quickly meet improving demand. Furthermore, analysts expect the company to post 20.7% revenue growth next year. This does not sound like a company expecting more pain ahead.

Regardless of total sales taking a brief hit this past quarter, total customers actually grew by 13%. This shows that interest in the company's products is still growing, which may mean sales will begin to pick up even more as pandemic-induced economic pain ebbs.

Revolve's leadership also seems to be encouraged by the company's future prospects. In March of this year -- after live events had already begun shutting down -- Karanikolas and Mente both made sizable purchases in their company, sinking a combined $2.5 million into it. Importantly, neither have done any selling since.

Year to date price performance chart of global E-commerce and Revolve Group

Image source: YCharts.

What to make of Revolve Group

Regardless of Revolve's dependence on live events being somewhat costly in a pandemic, its digitally native offering and a timely tilt to online marketing has served the company well. Yes, this e-commerce play has significantly lagged its industry, but I believe the stock's under performance provides a compelling opportunity for investors. If you're looking for a not-so-loved e-commerce play to turn things around, Revolve is the company I'd pick.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.