The Zacks Internet – Delivery Services industry sits in the bottom 8% of nearly 250 Zacks industries, and the group has plunged 45.7% over the past year. The industry’s earnings estimate for 2026 has been cut 2.5% over the past 12 months. Against that backdrop, three names are quietly defying the slide. GoDaddy (GDDY), Vipshop Holdings (VIPS) and Asure Software (ASUR) all carry a Zacks Rank of #3 (Hold), and all three saw their 2026 earnings estimates revised upward over the past 60 days, anchored by Q1 2026 results that met or beat Wall Street’s expectations.
Each name sits at a different point on the consumer map. GoDaddy runs the largest Internet domain registrar and web hosting operation serving small businesses. Vipshop runs a flash-sale e-commerce platform selling branded goods in China. Asure sells cloud-based human capital management software to small and mid-sized businesses. What binds them is the rating, the upward revisions, and the timing: all three reported between late April and late May 2026.
What the Industry Is Telling Investors
The Zacks Internet – Delivery Services industry groups companies in food delivery, online travel booking, web hosting and direct marketing. It carries a Zacks Industry Rank of #227, which places it in the bottom 8% of nearly 250 Zacks industries. The rank is a function of the average Zacks Rank of all member stocks, weighted by earnings estimate revisions, and most of the constituents currently carry downbeat outlooks. The group underperformed both the broader market and its own sector by a wide margin over the past year, plunging 45.7%.
The industry’s earnings estimate for 2026 has moved down 2.5% over the past 12 months, the metric that drives the rank. That negative aggregate revision is what keeps the group in the bottom 50% of Zacks-ranked industries. Zacks research shows the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 over time.
- Zacks Industry Rank: #227 (bottom 8% of nearly 250 industries)
- 1-year price return: -45.7% (vs. S&P 500 +26.8%, sector +43.6%)
- 2026 EPS estimate revision: -2.5% over past 12 months
- Forward 12-month P/S: 0.87X (vs. S&P 500 5.10X, sector 6.59X)
- 5-year P/S range: 0.66X to 2.03X, median 1.00X
Three pressures are doing the damage. Macroeconomic uncertainty, inflation, and high interest rates are squeezing both consumer and enterprise spending. Tariffs and the ongoing war in the Middle East are piling pressure on small businesses, the buyer base that drives demand for web hosting, online marketing and HR software. Aggressive hiring and heavy sales and marketing investment to stay competitive are pushing operating costs higher at the moment demand is softening. The industry sits at rank #227 in the Zacks industry classification, per the Internet – Delivery Services industry page.
The Valuation Gap That Frames the Trade
The industry trades at a deep discount to the broader market on a forward 12-month price-to-sales basis. Internet – Delivery Services is at 0.87X, against 5.10X for the S&P 500 and 6.59X for the Zacks Computer and Technology sector. Over the past five years, the industry has ranged from 0.66X to 2.03X, with a median of 1.00X. The current multiple sits below that median. The discount also reflects a market that has spent most of the last year pricing in deteriorating earnings power for the group’s members.
Online delivery has not yet expanded beyond major metropolitan areas, underscoring lower penetration and room to grow. The companies that win the next phase of geographic expansion, however, will carry heavier upfront costs that compress margins before revenue scales. Amazon continues to strengthen its delivery capabilities, and Alphabet is expanding into food delivery through projects like Wing, putting pressure on the smaller players in the field.
GoDaddy: A Q1 Beat Underneath the Selloff
GoDaddy operates the largest Internet domain registrar and web hosting business serving small businesses, web design professionals and individuals, and its Q1 2026 results showed momentum the broader industry is missing. Earnings came in at $1.60 per share, up 6% year over year and above the Zacks Consensus Estimate of $1.53 by 4.58%. Revenue rose 6.1% to $1.27 billion, with average revenue per user up 9.3% year over year to $246. The Applications & Commerce segment, GoDaddy’s growth engine, posted revenue of $498.2 million, up 11.6% year over year, and now contributes 39.3% of total revenue.
Newer Airo cohorts are monetizing better than non-Airo customers, with second-product attach running 30% faster. Normalized EBITDA margin expanded 210 basis points to 32.6%, and operating income climbed 25.6% to $310.5 million. Management reaffirmed 2026 revenue guidance of $5.195 billion to $5.275 billion and guided to roughly $1.8 billion in free cash flow. The Zacks Consensus Estimate for 2026 earnings has been revised up 11 cents to $7.17 per share over the past 60 days, with four analysts lifting their numbers, per GoDaddy’s Q1 2026 earnings beat details.
Even here, the industry’s broader pullback is visible. GoDaddy’s stock has been caught in the same downdraft that pulled the Zacks Internet – Delivery Services industry down 45.7% over the past year. The 2026 tech crash case for Microsoft made a similar argument about opportunity in a falling market. The Applications & Commerce segment is up 11.6% year over year, against 2.8% for Core Platform.
Vipshop: An In-Line Quarter Inside a Tougher China
Vipshop’s Q1 2026 results, released May 21, are the most ambiguous of the three names. Total net revenue rose 1.2% year over year to RMB26.6 billion ($3.9 billion), and gross margin expanded to 24.4% from 23.2%. Net income attributable to shareholders climbed 13.6% to RMB2.2 billion ($319.8 million), and operating margin rose to 9.4% from 8.7%. Active customers grew 0.9% to 41.7 million and total orders rose 3.2% to 172.6 million. Free cash flow for the trailing twelve months came in at RMB8.75 billion ($1.27 billion), and the company held RMB28.3 billion ($4.1 billion) in cash and short-term investments as of March 31, per Vipshop’s first-quarter 2026 results release.
The Zacks Consensus Estimate for current-year earnings has been revised up 5 cents to $2.66 per share over the past 30 days. Vipshop’s CFO Mark Wang described the print as in-line, with demand pulled forward around the Chinese New Year concentrating activity in the first two months.
Our first-quarter performance was driven by strong apparel sales, supported by a successful Chinese New Year holiday when consumers responded enthusiastically to our seasonal, value-for-money collections. Our SVIP customer base achieved solid growth in both number and contribution, reflecting our long-standing appeal to high-value consumers.
Eric Shen, Vipshop’s Chairman and CEO, made the consumer case in the company’s May 21 first-quarter 2026 results release. That framing matters because Vipshop’s Q2 2026 guidance points the other way. The company expects Q2 revenue of RMB24.5 billion to RMB25.8 billion, a year-over-year decrease of approximately 5% to 0%. The Q1 beat was real, but the comparison that follows is the harder one. China consumer spending is the variable, and warning signs in China’s tech sector are not a backdrop that suggests any quick re-acceleration.
The Zacks Rank remains #3 (Hold). The +5 cent revision is a smaller move than GoDaddy’s +11 cents, but the direction is the same.
Asure Software: A 23% Revenue Jump and a Profitability Flip
Asure sells cloud-based human capital management, time and attendance, and payroll software to small and mid-sized businesses, and its Q1 2026 print on April 30 marked what CEO Pat Goepel called the strongest start to a year in Asure’s recent history. Revenue rose 23% year over year to $42.8 million, with recurring revenue of $37.8 million up 14%. Net income flipped to $0.6 million from a $2.4 million net loss a year earlier. Adjusted EBITDA climbed 69% to $12.3 million, and non-GAAP gross margin reached 76%, per Asure’s first-quarter 2026 results release. The Zacks Consensus Estimate for 2026 earnings has been revised up 1 cent to 87 cents per share over the past 60 days.
Management guided Q2 2026 revenue to $36 million to $38 million and full-year 2026 revenue to $159 million to $163 million, with full-year adjusted EBITDA margin in the 23% to 25% range. The Q2 adjusted EBITDA guidance of $7 million at the midpoint, however, is below the $8.04 million analysts had modeled, a softer near-term signal inside an otherwise strong quarter. The three stocks compare this way:
| Stock | Ticker | Zacks Rank | Q1 2026 Print | 2026 EPS Estimate |
|---|---|---|---|---|
| GoDaddy | GDDY | #3 (Hold) | EPS $1.60 vs. $1.53 est.; revenue $1.27B (+6.1% Y/Y) | $7.17 (up 11¢ in 60 days) |
| Vipshop Holdings | VIPS | #3 (Hold) | Net income RMB2.2B (+13.6% Y/Y); revenue $3.9B (+1.2% Y/Y) | $2.66 (up 5¢ in 30 days) |
| Asure Software | ASUR | #3 (Hold) | Net income $0.6M (vs. loss); revenue $42.8M (+23% Y/Y) | $0.87 (up 1¢ in 60 days) |
The Risks Sitting in Front of All Three Names
The industry’s rank at the bottom 8% is not a backdrop to ignore. Three forces still sit in front of each name. For GoDaddy, the warning is the customer base. Small businesses and entrepreneurs are the buyers most likely to pull back first if tariffs and inflation keep biting, and the Applications & Commerce growth story depends on that base continuing to spend on websites, payments and AI tools. The Core Platform segment grew only 2.8% in Q1, a reminder that not every line of business is contributing equally to the upward 2026 revisions.
For Vipshop, the risk is inside the May 21 release. The company guided Q2 2026 revenue to RMB24.5 billion to RMB25.8 billion, a year-over-year decrease of approximately 5% to 0%. The post-Q1 trajectory carries the most uncertainty, and the data will arrive with the Q2 print later this year. The Q1 print was the easier comparison; the Q2 release is the test of the brand-discount model’s resilience.
For Asure, the issue is scale. The company’s market capitalization sat at $264.3 million the day it reported, with shares at $9.07. A 23% revenue jump is real, but the implied full-year growth rate from management’s $159 million to $163 million range is materially slower than Q1, and the Q2 EBITDA midpoint missed analyst expectations. Small stocks can move sharply around earnings prints.
Frequently Asked Questions
Why is the Zacks Internet – Delivery Services industry ranked so low?
The industry carries a Zacks Industry Rank of #227, placing it in the bottom 8% of nearly 250 Zacks industries. The rank reflects the average Zacks Rank of all member stocks, weighted by earnings estimate revisions. The group’s 2026 earnings estimate has been cut 2.5% over the past 12 months, and the group has plunged 45.7% over the past year, both factors pulling the rank lower.
What do GoDaddy, Vipshop and Asure actually do?
GoDaddy is the largest Internet domain registrar and web hosting company serving small businesses, web design professionals and individuals. Vipshop runs a flash-sale online discount retail platform in China, offering branded products to Chinese consumers through vipshop.com. Asure Software sells cloud-based human capital management, time and attendance, and payroll software to small and mid-sized businesses.
How recent are the three Q1 2026 earnings prints?
Asure reported Q1 2026 results on April 30, 2026. GoDaddy reported in early May 2026. Vipshop reported on May 21, 2026. All three releases came out between late April and late May 2026, and all three met or beat the Zacks Consensus Estimate or the relevant analyst expectations on the headline metrics.
Are the upward earnings revisions the same scale across the three stocks?
No. GoDaddy’s 2026 EPS consensus has been revised up 11 cents to $7.17 per share over the past 60 days, with four analysts lifting their numbers. Vipshop’s current-year EPS consensus has been revised up 5 cents to $2.66 per share over the past 30 days. Asure’s 2026 EPS consensus has been revised up 1 cent to 87 cents per share over the past 60 days. The revisions are all positive, but the scale differs by an order of magnitude.
What is the biggest risk to all three names?
The Zacks industry rank at the bottom 8% reflects a market pricing in deteriorating earnings power. Tariffs, inflation and the Middle East war are squeezing small business spending, the buyer base for all three companies. Vipshop’s own Q2 2026 guidance implies a year-over-year revenue decrease of 5% to 0%, a flag that even the strongest of the three names is not immune to its consumer environment.
Disclaimer: This article is for informational purposes only and is not investment advice. Investing in stocks involves risk, including the loss of principal. The figures cited reflect publicly available data as of the publication date and may change. Consult a qualified financial professional before making investment decisions.
