Global-E Online (GLBE 1.94%) was just another e-commerce company. Still, everything changed when Shopify became an investor, opening up new growth opportunities for the young company.

Investors took notice, sending the stock up from its IPO price of $25 to a high of $81.69 in 2021. Since then, the stock price has corrected by almost half to $40 (as of writing), attracting bargain hunters looking for potential bargains.

This article will explore the pros and cons of buying the stock today.

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There are good reasons to be bullish about Global-E

Cross-border e-commerce has historically been a complex task as companies have to deal with issues like regulation, foreign exchange, language and cultural differences, taxation, logistics, etc. Most businesses, except for a few major corporations, struggle to deal with so many issues altogether.

Enter Global-E. The e-commerce software and solution provider helps businesses offer their international customers a localized and user-friendly shopping experience. By leveraging its best-in-class localization capabilities, big-data models, streamlined global logistics, and vast cross-border expertise, it helps companies and brands sell to anyone, anywhere in the world.

Global-E's solid value proposition has helped customers succeed, which explains the rapid expansion of the company's revenues over the last few years. For perspective, revenue grew threefold from $136 million in 2020 to $409 million in 2022. The solid growth trajectory continued even after global economies reopened in the wake of COVID-19 lockdowns, with revenue growing by 53% year over year in the latest quarter.

There are good reasons to expect Global-E to grow at high rates for the next few years. One thing is that cross-border e-commerce is massive and growing; research firm Forrester estimates it will reach $736 billion in 2023. With an annualized gross merchandise volume of just $3.3 billion, this young company hasn't even touched 1% of that humongous market opportunity.

To this end, Global-E's partnership with Shopify will be helpful as it provides plenty of resources that the former needs for its expansion -- customers, technologies, and potentially, new capital investment.

But there are concerns as well

While there are good reasons to like Global-E, investors must consider the risks.

Global-E is a very young company with a short operational history. It did not exist until 2013, and has only been a public company for over two years. Its brief operating history makes it difficult for investors to assess its long-term viability and performance. For instance, we do not know how well the company will be able to handle economic downturns and other challenges.

The company will need more time to prove its worth to long-term investors. This is important since there are countless examples of promising start-ups losing their way amid challenges such as competition, funding constraints, or management issues. It will take time for Global-E to earn investors' confidence that it is not just another start-up, but one that will grow bigger and better over time.

It doesn't help that Global-E's stock trades at a premium valuation relative to well-established e-commerce companies like Amazon. At $40, Global-E trades at a price-to-sales (P/S) ratio of 13.0. Comparatively, Amazon has a P/S ratio of 2.5. While it's reasonable for the young company to trade at a premium valuation given its huge prospects and high growth rate, the stock will be susceptible to price corrections if market sentiment or growth expectations change -- especially if we consider its short operating history.

So, is Global-E's stock a buy now?

Global-E has executed well lately and is well-positioned to sustain its growth due to the vast cross-border e-commerce market opportunity and its partnership with Shopify.

The downside is that most of these potential positives are already reflected in the share price, so investors must pay up to buy the shares today. Besides, investors must believe in the company's ability to sustain its execution since it has only a short operating track record.

On balance, I think Global-E should remain on investors' radar for now. For the stock to become a buy, the company will have to deliver a few more quarters of solid performance, the stock price will have to become cheaper, or both.