1 Internet Stock with Exciting Potential and 2 We Brush Off

Whether it be online shopping or social media, secular forces are propelling consumer internet businesses forward. But it's not all sunshine and rainbows as consumer purchasing power can make or break demand. This unpredictability is weighing on the industry as its 8% return over the past six months has fallen short of the S&P 500's 15.9% gain.

Only some companies are subject to these dynamics, however, and a handful of high-quality businesses can deliver earnings growth in any environment. On that note, here is one resilient internet stock at the top of our wish list and two we're passing on.

Originally known as the first online auction site, eBay (NASDAQ:EBAY) is one of the world's largest online marketplaces.

Modest 1.3% annual growth in active buyers over the last two years indicates potential challenges in customer acquisition and retention

Anticipated sales growth of 8% for the next year implies demand will be shaky

Efficiency has decreased over the last few years as its EBITDA margin fell by 1.9 percentage points

eBay is trading at $106.46 per share, or 13.6x forward EV/EBITDA. Check out our free in-depth research report to learn more about why EBAY doesn't pass our bar.

Launched in 2003 by software engineers Michael Mente and Mike Karanikolas, Revolve (NYSE:RVLV) is a fashion retailer leveraging social media and a community of fashion influencers to drive its merchandising strategy.

Annual revenue growth of 6.6% over the last three years was below our standards for the consumer internet sector

May need to improve its platform and marketing strategy as its 6.5% average growth in active customers underwhelmed

Excessive marketing spend signals little organic demand and traction for its platform

At $21.20 per share, Revolve trades at 11.8x forward EV/EBITDA. To fully understand why you should be careful with RVLV, check out our full research report (it's free).

Famously founded by Mark Zuckerberg in his Harvard dorm, Meta Platforms (NASDAQ:META) operates a collection of the largest social networks in the world - Facebook, Instagram, WhatsApp, and Messenger, along with its metaverse focused Reality Labs.

Customer spending is rising as the company has focused on monetization over the last two years, leading to 24.4% annual growth in its average revenue per user

Disciplined cost controls and effective management resulted in a strong two-year EBITDA margin of 60.5%, and it turbocharged its profits by achieving some fixed cost leverage

Performance over the past three years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue

Meta's stock price of $727.65 implies a valuation ratio of 11.8x forward EV/EBITDA. Is now a good time to buy? See for yourself in our full research report, it's free.

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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.