Etsy (NASDAQ:ETSY) and Pinterest (NYSE:PINS) lie at the confluence of several high-growth secular trends that are getting a boost during the current global health crisis. The two stocks have been two of my favorite buys in recent months, and fresh Q3 2020 financial numbers only reinvigorate my appetite for more.

Regardless of how long the effects of the pandemic last, these two e-commerce stocks should be on long-term investors' radar.

Etsy: A holiday shopping frenzy is already here

The online marketplace for handmade goods reported another stellar quarter that topped management's already-lofty predictions. Gross value of merchandise sold (GMS) on Etsy surged 119% higher year-over-year in Q3 2020 to over $2.63 billion (beating a prediction for 110% growth), leading to a 128% jump in revenue to over $451 million (predicted to grow 115% at the top of guidance).

A grocery cart full of boxes sitting on top of a laptop.

Image source: Getty Images.

To be fair, another monster quarter is already priced in here. After all, Etsy stock is up over 210% 2020 to-date, so the epic sales gains totaling growth of 102% through the first nine months of the year fall short of the stock's rise in price. What accounts for the discrepancy? Etsy has turned a corner on the bottom line, and is now solidly in profitable territory. Net income is up 211% year-over-year through the first three quarters of 2020 to $201 million, including a massive 520% increase in Q3 alone. 

The question now is whether Etsy can maintain this momentum through the all-important holiday shopping season. CEO Josh Silverman and company think it's possible, calling for as much as an 85% increase in GMS and as much as a 90% increase in revenue from what was already a very busy Q4 2019 before COVID-19 struck. 

Looking farther down the road, though, I like where Etsy is at. It's picking up serious momentum from the rapid transition to e-commerce this year, and has added over 1 million active sellers and nearly 25 million new shoppers to its platform in the last 12 months. Paired with lots of people opting to start their own businesses and choosing Etsy as a partner to expand their audience, this e-commerce play is poised to continue delivering sales and profit growth for a long time to come. 

Pinterest: Social media is a winning strategy for retailers

I (finally) started purchasing Pinterest stock earlier this year, and doubled up on my position in September. I'm glad I did, because Pinterest just hit one out of the park during Q3. 

Revenue surged 58% higher from a year ago to $443 million. Net loss also narrowed to $94.2 million compared to a net loss of $125 million last year. Adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) was positive $93.0 million, as opposed to a meager $3.87 million in Q3 2019. Much like Etsy, Pinterest is turning a corner on the bottom line and could post even more dramatic profit expansion in the next coming years. To that I say "yes, please." 

Number of users and average revenue per user (ARPU) are closely watched metrics for the visual search company, and both of these areas did well in Q3. Global monthly average users grew 37% to 442 million, and global ARPU rebounded 15% to $1.05 after a rough go of it during the worst of the lockdown in the spring. Pinterest CEO Ben Silbermann and the top team apparently see the trend continuing given the call for about 60% revenue growth in Q4 during the busy holiday season. But what is most promising to me is that as these two metrics grow, Pinterest becomes an increasingly lucrative place for merchants and retailers to interact with customers. 

In fact, according to e-commerce and digital transformation consulting firm Avionos, social media sites like Pinterest are seen as an increasingly valuable tool for traditional brick-and-mortar retailers. In fact, some early indications are that traditional-style retail outperforms digital-native peers on social media. The jury on that is still out, but the Avionos study would seem to work in Pinterest's favor either way. Digital merchants are already accustomed to sharing their products online, and a massive wave of companies with physical storefronts are migrating to the internet -- and Pinterest is scooping up plenty of activity along the way. 

Shockingly, digital-only stores still comprise just 16% of retail sales this year according to data from the U.S. Census Bureau. E-commerce is a long-term secular growth trend, and with respective market caps of just $17 billion and $34 billion, I think Etsy and Pinterest still have massive upside. These two stocks are worth owning for the long-haul.

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.