Now trading at a price of $112.59, Shopify has moved 2.4% so far today.
Shopify returned gains of 69.8% last year, with its stock price reaching a high of $129.38 and a low of $48.56. Over the same period, the stock outperformed the S&P 500 index by 59.6%. More recently, the company's 50-day average price was $100.52. Shopify Inc., a commerce technology company, provides tools to start, scale, market, and run a business of various sizes in Canada, the United States, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. Based in Ottawa, Canada, the Large-Cap Technology company has 8,100 full time employees. Shopify has not offered a dividend during the last year.
Generally Positive Cash Flows but Slimmer Gross Margins than the Industry Average of 63.49%:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $1,578 | $2,929 | $4,612 | $5,600 | $7,060 | $8,880 |
| Gross Margins | 55% | 53% | 54% | 49% | 50% | 50% |
| Net Margins | -8% | 11% | 63% | -62% | 2% | 23% |
| Net Income (M) | -$125 | $320 | $2,915 | -$3,460 | $132 | $2,019 |
| Net Interest Expense (M) | $48 | $23 | $15 | $75 | $241 | $308 |
| Depreciation & Amort. (M) | $17 | $38 | $42 | $36 | $28 | $22 |
| Diluted Shares (M) | 113 | 123 | 1,274 | 1,266 | 1,296 | 1,302 |
| Earnings Per Share | -$1.1 | $2.59 | $2.29 | -$2.73 | $0.1 | $1.55 |
| EPS Growth | n/a | 335.4545454545454% | -11.583011583011576% | -219.2139737991266% | 103.66300366300368% | 1449.9999999999998% |
| Free Cash Flow (M) | $14 | $383 | $485 | -$186 | $905 | $1,597 |
| CAPEX (M) | $57 | $42 | $51 | $50 | $39 | $19 |
| Current Ratio | 8.67 | 15.69 | 12.15 | 7.07 | 6.99 | 3.71 |
Shopify has generally positive cash flows and an excellent current ratio of 3.71. Additionally, the company's financial statements display rapidly growing revenues and decreasing reinvestment in the business and a strong EPS growth trend. However, the firm has slimmer gross margins than its peers.
Shopify's Valuation Is in Line With Its Sector Averages:
Shopify has a trailing twelve month P/E ratio of 81.7, compared to an average of 30.44 for the Technology sector. Based on its EPS guidance of $1.85, the company has a forward P/E ratio of 54.3. Shopify's PEG ratio is 6.95 on the basis of the 11.8% weighted average of the company and the broader market's EPS compound average growth rates. This suggests that the company's shares are overvalued. Furthermore, Shopify is likely overvalued compared to the book value of its equity, since its P/B ratio of 13.21 is higher than the sector average of 4.19. The company's shares are currently trading 539.7% below their Graham number. Ultimately, Shopify's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued, its elevated P/B ratio notwithstanding.
Shopify Has an Average Rating of Buy:
The 44 analysts following Shopify have set target prices ranging from $65.0 to $105.0 per share, for an average of $82.58 with a buy rating. The company is trading 36.3% away from its average target price, indicating that there is an analyst belief that shares are overpriced.
Shopify has an average amount of shares sold short because 2.2% of the company's shares are sold short. Institutions own 74.8% of the company's shares, and the insider ownership rate stands at 0.19%, suggesting a small amount of insider investors. The largest shareholder is BAILLIE GIFFORD & CO, whose 5% stake in the company is worth $6,291,275,442.
