Pinterest (PINS -0.82%) and Shopify (SHOP 0.29%) haven't exactly been great performers, but both of these companies still have incredible growth potential. Shopify has the number two e-commerce market share and could continue to build out its ecosystem of services over time, while Pinterest is all-in on pursuing ways to incorporate e-commerce into its visual discovery platform.

It's worth noting that both Pinterest and Shopify have been severely beaten down in the 2022 market downturn. Pinterest is down by about 75% from its 2021 peak, while Shopify is down by about 85%. Pinterest could 5x and barely get above its previous high, while Shopify could 5x and still not set a new all-time high.

With all of that in mind, here's a rundown of why I'm a fan of both companies, and which one I think is likely to deliver multi-bagger returns quickly.

The bull case for Pinterest

First, one of the biggest reasons Pinterest's stock price has been under pressure is that the user base has declined quite a bit from its 2021 peak. This makes sense -- as the world gradually returned to normal, people had less time to browse on social media platforms.

However, the user declines have now stabilized. Pinterest has actually added 2 million active users in 2022. But the real story is monetization. The average active Pinterest user generates 17% more revenue for the company than it did a year ago, and the company is still in the very early stages of international monetization. The average U.S. Pinterest user generated $5.82 in revenue in the second quarter, but the average user outside of the U.S. and Europe produced just $0.10. And the majority of users are in this category. If it could achieve just a fraction of its domestic monetization overseas, Pinterest's revenue would skyrocket.

Plus, Pinterest's model has so far been a traditional social media advertising one, for the most part. But the company is in the early stages of figuring out how it fits in the e-commerce landscape. It certainly makes sense -- after all, Pinterest is a place people go to find things they often end up buying. The company recently brought in e-commerce heavyweight Bill Ready as CEO, has formed several key partnerships (including one with Shopify), and has even acquired a popular e-commerce platform, The Yes.

The bull case for Shopify

Shopify has the number two e-commerce share in the United States, with only Amazon (AMZN 0.83%) owning more of the space. But we think this could be just the starting point. E-commerce itself still makes up less than 15% of all retail sales in the United States, and this figure is far smaller in many key international markets. In fact, by 2025, e-commerce sales volume worldwide is expected to reach $7.4 trillion.

Shopify offers an all-in-one ecosystem for merchants. It hosts online stores, but also offers things like payment processing, marketing tools, and more. Plus, Shopify's platform works for merchants of all sizes, with plans that cost more for larger, more complex businesses, so Shopify's revenue grows naturally if its customers succeed. While the next few quarters could be challenging as the COVID-fueled e-commerce surge calms down, the long-term trends are still intact.

Which is more likely to produce 5x returns faster?

Both of these stocks have tremendous long-term growth potential. If Pinterest is successful in monetizing e-commerce and Shopify can return to profitable growth, there's no reason that both can't produce 5x returns (or much more) from here. I'd even go so far as to say it's rather likely to happen eventually if all goes well for these businesses. But it's far from a certainty.

As far as which is more likely to get there first, I'd have to go with Pinterest. Monetization is clearly moving in the right direction, the user base has stabilized, and the company is making big moves to boost its potential. But there's a clear case to be made for Shopify as well, and I own both stocks in my personal portfolio.