Shopify, Inc. (NYSE: SHOP) the stock is trading lower on Wednesday after Wedbush analyst Ygal Arounian downgraded the rating from Outperform to Neutral and raised the target price from $66 to $68. The revaluations followed Shopify’s investor day.
Oppenheimer analyst Ken Wong reiterated outperform with a price target of $80.
Wong left Shopify’s investor day with more confidence that management will pursue sustainable growth in a disciplined manner and remain committed to margin expansion.
Despite the reduction in marketing spending, the development of new merchants motivated the analyst.
Shopify highlighted positive competitive trends, showing market share gains across all customer segments.
Management cited payments penetration, new product adoption, pricing and monetization as drivers of attach rate, with significant business volume, offline and international as drags.
Wong forecast fourth-quarter revenue and EPS of $2.0 billion and $0.32.
Needham analyst Anna Andreeva reiterated a Hold rating.
Uniquely positioned at the intersection of technology and retail, SHOP sees its share over competitors nearly double while focusing on efficiency within the organization to drive sustainable growth .
The analyst came away more constructive about the long-term positive narrative on the stock; macro and valuations kept him away.
Andreeva forecast fourth-quarter revenue and EPS of $2.08 billion and $0.33.
Piper Sandler analyst Clarke Jeffries reiterated an underweight with a $56 price target.
The analyst attended Shopify’s first investor day in four years, where he discussed product, strategy and market opportunities as SHOP closes a transformative year where growth reaccelerated and margins have increased considerably.
The presentations reinforced the strengths and features that have made Shopify an e-commerce leader with approximately $7 billion in revenue generating over $200 billion in GMV – both metrics grew 50x Since. Initial Public Offering.
However, the new revelations offered little to incorporate into his model. Jeffries’ opinion following last week’s deterioration is unchanged.
Jeffries forecast fourth-quarter revenue and EPS of $2.08 billion and $0.31.
Raymond James analyst Brian Peterson reiterated a market perform rating.
The analyst noted that investors should come away from the event with a better appreciation of the company’s pace of innovation and its ability to enable digitally native merchants.
Shopify has expanded its GMV growth avenues through PoS, Shop Pay, and Components, which is expected to drive structurally higher GMV growth rates relative to total commerce.
Even if it remains encouraged by the fundamental evolution of the last 12 months, valuation remains its main obstacle.
Read also: Shopify merchants break records with Black Friday Bonanza
Price Action: SHOP shares were down 2.89% at $72.54 at last check Wednesday.
Latest notes for SHOP
Date | Farm | Action | From | HAS |
|---|---|---|---|---|
February 2022 | Morgan Stanley | Maintains | Equal weight | |
February 2022 | Swiss credit | Maintains | Neutral | |
February 2022 | Mizuho | Maintains | Neutral |
View more analyst ratings for SHOP
View the latest analyst ratings
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