The 60% sell-off that BigCommerce Holdings (NASDAQ:BIGC) shares have dished out since September's peak is intimidating, to be sure. Stock prices fall for a reason, after all, and if they lose ground in the middle of a raging bull market like the one we've seen in recent weeks ... well, that's even worse.

This is a case, however, in which a stock tumbled for all the wrong reasons. Post-IPO profit-taking looks like the key culprit, underscored by a sheer lack of analytical coverage. With both headwinds now abating, the company's true potential is becoming clear. The fact that the stock is still just a few days removed from a record low price of $57.26 a share only makes it more of a gift to investors searching for an overlooked prospect.

Metallic dice with "buy" and "sell" faces up, lying on a stock chart.

Image source: Getty Images.

A real solution to a real problem

There's a reason you may have never heard of BigCommerce -- it has only been a publicly traded name since August, and it's garnered less attention than its bigger rival Shopify (NYSE:SHOP). Don't let the lack of notoriety or scale fool you, however. This company is an underestimated opportunity.

Much like Shopify, BigCommerce Holdings helps enterprises build and maintain an e-commerce presence. Site-building, digital shopping carts, and web-search optimization are just some of BigCommerce's software-as-a-service offerings that brands like Hush Puppies, Gillette, Ben & Jerry's, and the Detroit Pistons are utilizing.

Less evident is the growing tension between Amazon and its sellers. Simply put, many third-party sellers say the e-commerce behemoth is increasingly difficult and increasingly dangerous to partner with. As an example, algorithmic reviews of the site's sellers can lead to a surprise suspension of stores. In many cases, however, these suspensions aren't merited. Getting those online stores reinstated is challenging and time-consuming (when it's possible at all). Any platform helping merchants sidestep such risks is well-positioned to carve out a piece of what eMarketer estimates is a global e-commerce retailing market now worth $4.2 trillion per year, but expected to be worth $6.5 trillion by 2023.

We're seeing evidence of merchants moving in the direction of self-sufficiency. It's quietly buried in BigCommerce's historical and projected fiscal results.

As the dust settles, a compelling picture emerges

The chart below tells an encouraging tale. BigCommerce is growing and is expected to grow its way into an operating profit sometime in 2023. Actual profits, or generally accepted accounting principles (GAAP) profits, are expected to materialize around 2024.

BigCommerce Holdings (BIGC) is growing steadily, on route to profitability by 2022.

Data source: BigCommerce Holdings S1 prospectus and Thomson Reuters. Chart by author.

Yes, the company's third-quarter growth leap had everything to do with the coronavirus pandemic. The analyst community believes the margin growth linked to this flood of new business is here to stay, even though Q4 revenue is likely to fall just a bit from Q3's levels. Growth should kick in again this quarter. Analysts are modeling sales growth of 19% this year, corresponding with a halving of last year's per-share losses.

So if the story is so compelling, why are BigCommerce shares toying with all-time lows?

Part of the stock's challenge is the company's age. While BigCommerce is now more than a decade old, it only went public in August of last year. A little more than a dozen analysts are currently following it -- which isn't many -- leaving investors largely uninformed about the organization. As the company proves itself, more analysts should put BigCommerce Holdings on their coverage radars.

Perhaps the stock's bigger struggle of late, however, is the usual volatility equities seem to experience shortly after their initial public offerings. That is, while hype catapults a stock out of the gate, profit-takers often quickly swoop in, driving a new equity sharply lower. Shell-shocked investors may let the dust settle for a few months before pricing a company in a way that better reflects results rather than rhetoric. Take some time to look at historical charts of Facebook, Twitter, and Zynga, just to name a few. Each was red-hot shortly after going public, and each is doing well now. But all three stocks tanked shortly after their post-IPO rallies.

Similarly, BigCommerce shares are pushing up and off their record lows now reached in the shadow of incredible post-IPO bullishness. Only time will tell if the effort is going anywhere, but the company's backstory is just as attractive now as it was in August. The only thing that's different is the stock price.

The bottom line for BigCommerce

Sure, the lack of current profits is a concern. This stock is not for everyone, like retirees or the extremely risk-averse.

Keep things in perspective, though. Riskier trades have paid off in the past before it became clear they'd pay off. The trajectory is the key, and BigCommerce is on a trajectory to profits. Snap isn't yet profitable, and its stock soared more than 200% last year. Slack Technologies is another name expected to remain in the red through this year, but that didn't prevent Salesforce from making a generous acquisition offer in November, leading to a nearly 90% gain for the stock last year.

The point being, the market rewards progress as much as it rewards earnings.

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.