Why MercadoLibre, Shopify, and Sea Limited Stocks Crashed

$Sea Ltd(SE)$ $MercadoLibre(MELI)$ $Shopify(SHOP)$

What happened

In case you hadn't noticed yet, the stock market kind ofcurled up in a ball and diedtoday. As of 12:40 p.m. ET, theDow Jones Industrial Averageis down a disheartening 3.2%, and theNasdaqis down 4.6%.

But don't panic,this happens from time to time, and from one perspective, all it really means is that stocks are going on sale.

Of particular interest to growth investors today is the fact that some of the fastest growing e-commerce stocks in the world are going on sale, with shares ofMercadoLibre(NASDAQ:MELI)down 8.6%,Shopify(NYSE:SHOP)falling 10%, andSea Limited(NYSE:SE)leading the pack lower with a 12.3% loss.

So what

Aside from the fact that pretty muchallstocks are in the red today, however, there's no particular reason why these three stocks, specifically, are selling off -- other than valuation concerns, at least. As it turns out, Shopify is the only one of the three with any obvious news on the wires, and even that news isn't too awfully bad.

Specifically, investment banker Wedbush cut its target price on Shopify this morning, citing concerns that the company's third-party logistics (3PL) strategy wasn't providing the "market advantage" Shopify was looking for, reportsTheFly.com, and that Shopify has begun terminating contracts with 3PL providers as a result. Despite this concern, Wedbush still sees Shopify stock as bargain-priced at under $900 a share -- and predicts it will end the year closer to $1,300.

Now what

Personally, I don't know that I'd gothatfar in recommending Shopify. What I will say is that with $103 billion in market capitalization and $3.4 billion in earnings under generally accepted accounting principles (GAAP), Shopify at 30 times earnings is finally starting to look reasonably priced to me -- and the more it drops, the more like a bargain Shopify stock looks.

Shopify certainly looks like more of a bargain than MercadoLibre at 619 times earnings, or Sea Limited, which although it does boast positivefree cash flow, remains GAAP unprofitable to this day. In a world where stock prices have suddenly become dramatically cheaper, I think investors are best advised topick the lowest-hanging fruit first.