went public in 2015 and has rewarded shareholders with returns in excess of 2,600%. The company helps millions of merchants build out an e-commerce presence, which has resulted in hundreds of millions of people buying from Shopify merchants annually.

Shopify's place in the e-commerce ecosystem is important and won't be going away for the foreseeable future. The company even has opportunity for growth. But when it comes to upside in the stock, I believe potential returns are more attractive today for two other e-commerce platforms: Sea Limited (NYSE: SE) and MercadoLibre (NASDAQ: MELI).

In short, I believe that the long-term prospects for these two are at least as good as they are for Shopify. Yet their shares trade at just a fraction of Shopify's valuation. For comparison purposes, see the two metrics below: the price-to-sales ratio and price-to-free-cash-flow ratio. Both indicate that Shopify stock is the priciest.

Continue reading

Source Fool.com