The E-Commerce Stocks to Buy Before the Holiday Quarter

The holiday quarter starts in about two weeks. And for e-commerce companies, it's the three months that matter most. Consider Shopify (NASDAQ:SHOP). The e-commerce software company earned $631 million of operating income in last year's fourth quarter -- 43% of its operating income for all of 2025.

Amazon (NASDAQ:AMZN) and MercadoLibre (NASDAQ:MELI) lean on the season, too, though not nearly as hard. Notably, all three companies close their books on Dec. 31, so the December quarter is the fourth quarter for each.

Here's a closer look at all three stocks ahead of the season.

Image source: Getty Images.

The biggest holiday swing

Shopify's concentration isn't a one-off. The fourth quarter delivered 43% of the company's operating income in both 2025 ($631 million of $1.47 billion) and 2024 ($465 million of $1.08 billion). Not only is the holiday quarter the company's biggest for revenue (about 32% of 2025's total), but it's also the year's most profitable by a wide margin. Operating expenses don't rise with the holiday rush the way merchant sales do, so much of the season's extra gross profit can turn into operating income.

And I think this year's setup looks even better. Second-quarter gross merchandise volume (the value of goods sold across the platform) rose 32% year over year, a fifth straight quarter of growth above 30%. Operating income climbed 68% to $488 million. In fact, profit growth has been accelerating: Operating income rose 37% in 2025, and it's rising much faster this year. For the third quarter, management guided for revenue growth in the low-thirties percentage range.

The problem, however, is the stock's price.

Shopify shares have pulled back sharply, from a 52-week high above $182 to about $130 as of this writing. Yet the stock still costs about 53 times what the company is expected to earn next year.

Amazon's holiday quarter matters less than it used to

The e-commerce giant still gets a seasonal lift. Fourth-quarter operating income of $25 billion last year was about 31% of the full-year total of $80 billion, a share almost unchanged from 2024. But Amazon's profit engine is increasingly its cloud computing business, Amazon Web Services, which doesn't depend on the shopping calendar.

Profit growth is accelerating, too. Operating income rose 17% in 2025, then rose 43% to $27.5 billion in this year's second quarter. And for the third quarter, management guided for operating income of $22.5 billion to $26.5 billion, up from $17.4 billion a year earlier.

Meanwhile, the company is stretching the season. This week, Amazon set its Prime Big Deal Days sale for Oct. 6 and 7, which could pull holiday spending into the quarter's first week.

Shares trade near $248 as of this writing, or around 24 times Amazon's expected earnings per share for next year, the lowest price-to-earnings multiple of the three.

MercadoLibre spends the season buying growth

The Latin American e-commerce and fintech company runs the holidays differently.

Its fourth-quarter revenue jumped 45% year over year to $8.8 billion in 2025, the company's biggest quarter of the year. Yet income from operations of $889 million was only 28% of the 2025 total, down from a 31% share in 2024.

That wasn't an accident. Management said it made "tactical investments to reinforce Mercado Libre as the primary destination for demand during peak season" -- in other words, it spent on free shipping, marketing, and credit cards to capture holiday shoppers.

And the spending hasn't let up. Second-quarter revenue soared 50% year over year to $10.2 billion, while the operating margin narrowed to 6.7%, from 9% in the fourth quarter of 2025 (excluding a one-time tax credit in that quarter). Management is deliberately trading near-term margin for growth.

MercadoLibre's stock trades at about 33 times the profit it's expected to produce next year. For a company growing revenue 50%, the price is arguably fair, if the spending eventually pays off.

Which would I buy before October?

Ultimately, Amazon is my first pick. Its profits lean less on the season than Shopify's (the cloud earns all year), and its shares carry the lowest price-to-earnings multiple of the three.

MercadoLibre is a close second. Margins may stay under pressure through the holidays (that's the plan, after all), but revenue growing 50% covers a lot of spending. I'd buy it, too, though I'd keep the position smaller.

Shopify is the group's best pure holiday story, and the most concentrated payoff sits just ahead. The growth is exceptional, to be sure. But a price of about 53 times forward earnings already assumes years of quarters like these.

Of course, a weak holiday season would hurt all three -- Shopify most of all. I would hold off on Shopify shares at this price.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, MercadoLibre, and Shopify. The Motley Fool has a disclosure policy.