Despite still being in the midst of a deep recession, expectations are high for the 2020 holiday shopping season. In particular, investors are counting on e-commerce to play a huge role in how consumers spend over the holidays this year, and Amazon.com (NASDAQ:AMZN), is, of course, expected to lead the charge.
But it's not going to be the only big winner. On the Oct. 23 edition of "The Wrap" on Motley Fool Live, host Jason Hall, Motley Fool contributor Danny Vena, and Motley Fool Analyst Jason Moser discussed three other stocks they think are primed for big growth this holiday season and beyond.
Jason Hall: American Express just reported, and part of the reports they said that consumer spending that they saw, of course, this is adjusting out travel and entertainment because nobody's flying and most of your restaurants are closed and you're not going through them -- they're delivering if you do want anything.
So adjusting for those pandemic impacted things, consumer spending actually increased in the third quarter. Not from the second quarter, but increased from last year. That's a big deal. I think it also supports the idea that this is going to be a huge holiday shopping season.
Guys, Danny, I want you to answer this one first. I want you to name one company that is best positioned to have a great fourth quarter because of consumer spending, but that company can't be Amazon. Danny, what do you got?
Danny Vena: Well, since I'm going to be hamstrung here just a little bit, I'm going to go with Shopify (NYSE:SHOP). Still raking in the e-commerce dollars, still consumer-facing via the merchants on its platform. Shopify has been growing like a weed, and I don't see that slowing down anytime in the near future.
Hall: Jason, now that you've been further hamstrung here, who do you say? Who's going to win this fourth quarter?
Jason Moser: Totally agree with Danny there. I'm a happy Shopify shareholder, but I'll throw Etsy (NASDAQ:ETSY) into the mix there. Actually, when we had Fool Fest this summer and I put together just like a stay-at-home stock basket, Etsy was one of those stocks. Just to say they have proven beyond a reasonable doubt that they are basically Amazon-proof at this point. Amazon cannot disrupt Etsy. I'm going to go ahead and make that call.
The numbers tell the story, and Etsy has just been on fire. I actually like the Reverb acquisition that they made and Reverb, for those who aren't familiar, that's the network that connects them for musical instruments and equipment. We actually bought a guitar from Reverb for my daughter for last Christmas, and it was just seamless experience. I feel like they have a number of different ways they can go. Seeing a lot of advertising over the past several months, and the business just continues to light it up.
Hall: Yeah, I know I'm muted. Sorry about that, guys. My wife's on a call. She is here in the office with me, and her job is actually more important than mine. So if anybody is getting kicked out of this office, that's going to be me. I'm going to throw Mastercard (NYSE:MA) out there. I think this is -- it's a transactional business; they've done incredible this year and I think they're just going to continue to do incredible whether or not consumer spending has a great quarter, but I think it will.
I think Mastercard is one you still have to have on that list.