A strong side effect of the social restrictions imposed to fight the spread of the coronavirus has been the rise of e-commerce. With many confined to their homes, completing everyday shopping online has become the ‘norm’. This has seen the likes of ASX growth companies, Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and digital retailer, Kogan.com Ltd (ASX: KGN) benefit from the surge in online shopping.

And even as restrictions ease, it could be a long time before brick and mortar foot traffic reaches pre-coronavirus levels. In fact, the crisis could have brought about a permanent change in the way people shop. 

Let’s look into how this digital retailer and the buy now, pay later companies are benefitting from the shift.  

Kogan.com

The coronavirus crisis has turned promising e-commerce player Kogan.com into a bona fide market darling. Its share price raced to an all-time high of $13 last week, on the back of a string of positive business updates throughout the crisis.

With many traditional brick and mortar retailers closed and people confined to their homes during lockdowns, rates of online shopping increased dramatically. With one month still to go in the FY20 fourth quarter, Kogan has already recorded gross sales growth of 100%, and gross profit growth of 130%.  

The company is hoping to use this unique opportunity to pursue further growth. Kogan shares were placed into a trading halt on Wednesday, 10 June after the company announced a $100 million capital raising. Kogan hopes to use the cash injection to take advantage of any ‘value accretive opportunities’. This could mean company acquisitions are on the horizon.

Afterpay

Since falling to a 52-week low of just $8.01 at the height of the market selloff in late March, shares in Afterpay have soared an astonishing 580% to a new all-time high of $54.69.

Investors initially flocked to Afterpay after the company announced it had continued to perform strongly throughout the March quarter. Underlying sales were $2.6 billion for the quarter, a 97% increase over the FY19 third quarter. Unsurprisingly, March notched up the company’s third-highest monthly underlying sales total on record.

Afterpay has since reached another milestone: 5 million active users in the US. This is a significant achievement as it gives Afterpay a foothold in a lucrative new market. This comes just two years after launching in the region. It is even more interesting now in light of the Quadpay acquisition by Afterpay’s key competitor, Zip. It will be fascinating to watch as the two major Australian players battle it out in the US market.

Zip Co

The share price of ASX buy now, pay later company, Zip skyrocketed recently after it announced plans to acquire New York-based fintech Quadpay Inc. Quadpay is one of the leading buy now, pay later platforms in the US. It has total transaction volumes for the most recent quarter of $225.1 million and revenues of $17.8 million.

Zip claims that once the acquisition is complete, it will be one of the leading global players in the buy now, pay later space with close to $250 million in annualised revenues. The company’s share price soared to an all-time high price of $6.79 on the back of the news.

More reading

• Why Aventus, Kogan, Newcrest, & Northern Star are pushing higher
• A $10,000 investment in the Zip Co IPO would be worth $350,000 today
• Why the Kogan share price jumped 11% to a record high today
• My share investing journey during the pandemic
• 3 ASX shares to buy now with $10,000

Rhys Brock owns shares of AFTERPAY T FPO, Kogan.com ltd, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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S&P/ASX 200 Index (ASX: XJO) shares are great place to look for long-term investment opportunities.

Plenty of ASX 200 shares are market leaders in their industry. Owning the largest, best business in an industry can help generate stronger returns for our portfolios.

The best way to generate long-term returns is to invest for the long-term. So, here are three shares I think are opportunities for this year and beyond:

Share 1: REA Group Limited (ASX: REA)

REA Group is the owner of Australia’s most popular real estate portal. The REA Group share price is still down 7% from where it was on 21 February 2020. That’s despite the lower interest rate. 

The ASX 200 share has a strong market position as the clear property leader in Australia. Potential property buyers will go to the site with the most properties for sale. Potential sellers will want to list on the site with the biggest buying audience. It’s a very beneficial loop for REA Group.

There wasn’t much volume of property listings during the worst period of the coronavirus lockdowns. But now there’s more activity. Once jobkeeper ends in September there could be forced sellers, so more properties could come onto the market.

Over the long-term I’m excited by REA Group’s stakes in overseas property sites in regions where the population is much higher than Australia. One property site services the US. 

Share 2: Service Stream Limited (ASX: SSM)

Service Stream is an ASX 200 share that specialises in network infrastructure. It’s involved in the designing, construction, maintenance and operation of networks like telecommunications, electricity, gas, water and ‘new energy’.

The company had been consistently growing its earnings over the past few years before COVID-19. It’s expecting to report another solid result in FY20. Federal, state governments and businesses plan to continue spending on infrastructure over the coming years which should be good for Service Stream. The construction of the new 5G networks should be helpful for earnings too.

Service Stream has also been steadily growing its dividend. The ASX 200 share offers a grossed-up dividend yield of 6.8%. That looks pretty good to me. The Service Stream share price is down 27% since 5 February 2020.

Share 3: Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is my favourite ASX 200 share, so I had to include it. It’s an investment conglomerate that takes long-term stakes in a variety of businesses like Brickworks Limited (ASX: BKW), TPG Telecom Ltd (ASX: TPM) and Bki Investment Co Ltd (ASX: BKI). It’s also invested in unlisted businesses like swimming schools and agriculture.

The investment house itself makes long-term investment decisions, so I think it’s easy to be a long-term investor in Soul Patts.

I like that it’s a conservative investor, and contrarian when there are unloved opportunities. Investing in agriculture during one of Australia’s worst droughts is the sort of brave investing that Soul Patts has done.

I believe Soul Patts has a great chance of outperforming the ASX 200 over the longer-term. The TPG merger is compelling. Brickwork’s expansion into the US is exciting. Soul Patts is about to start investing in regional data centres in Australia.

Foolish takeaway

I think each of these ASX 200 shares have a great future. Service Stream could be the strongest performer over the next 18 months if Australia’s economy keeps rebounding. But Soul Patts would be the share I’d buy today if I wanted a share to hold for many, many years.

More reading

• What is the ASX impact of a fall in house prices?
• 3 great shares to buy now if you’re an ASX 200 investor in your 20s
• Why do I own this ASX 200 share?
• 3 ASX 200 shares to add to your watchlist in 2020
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended REA Group Limited and Service Stream Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post 3 ASX 200 shares I’d buy for 2020 and beyond appeared first on Motley Fool Australia.

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Recently I’ve been looking at how investments in the IPOs of a number of ASX shares have fared.

Today, I thought I would turn my attention to one of the most popular shares on the market at present – Zip Co Ltd (ASX: Z1P).

Zip Co is a fast-growing payments company which competes with Afterpay Ltd (ASX: APT) in the buy now pay later market.

The Zip Co IPO.

It has been almost five years since Zip Co listed on the Australian share market.

Its shares hit the ASX boards in September 2015 after raising $5 million through the issue of 20 million shares at 20 cents per share.

This means that if you had invested $10,000 into its IPO, you have would have received 50,000 shares.

Since then the company has gone from strength to strength thanks to the increasing popularity of buy now pay later with both consumers and retailers globally.

Consumers, particularly those in the millennial and Gen Z demographic, are turning to platforms like Afterpay and Zip Co instead of credit cards. This has led to Zip Co delivering stellar underlying sales growth over the last few years.

This has continued during the pandemic. After smashing expectations in the third quarter, Zip Co’s explosive growth continued in April when it delivered monthly transaction volume of $181.6 million. This was an 86% increase on the prior corresponding period.

The good news is that this is still only scratching at the surface of its overall market opportunity. Especially now it is expanding into the $5 trillion U.S. retail market via the acquisition of QuadPay.

It is largely because of this strong form and acquisition that the Zip Co share price hit a record high of $6.97 this morning.

When its shares hit that level, the 50,000 shares you would have received by investing in its IPO would have been worth a massive $348,500. That certainly is an impressive return in less than five years, right?

More reading

• ASX growth companies including Zip Co cash in on the rise of e-commerce
• My share investing journey during the pandemic
• 3 ASX shares to buy now with $10,000
• Afterpay share price up 7%, ASX 200 edges higher
• Afterpay share price overbought says analyst

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post A $10,000 investment in the Zip Co IPO would be worth $350,000 today appeared first on Motley Fool Australia.

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