A Glimpse Into Shopify Inc (US) (SHOP) Earnings

Shopify Inc (US) (NYSE:SHOP) shares climb nearly 3% in Tuesday’s trading session, after the e-commerce giant reported first-quarter revenue of $127.4 million, exceeding consensus’ $121.7 million estimate and the high end of guidance of $120-$122 million. The beat was driven by strength in both Subscription and Merchant solutions.

Looking ahead, Shopify forecast second-quater revenues of $142 to $144 million, beating consensus estimate of $137.09 million.

Shopify’s CFO Russ Jones commented, “With our excellent start to the year, it is clear we are becoming the de facto platform for sellers […] In addition to merchant growth and their adoption of both new channels and merchant solutions, we also continue to see expansion of merchants’ GMV. Retail is shifting headlong toward the vision we laid out two years ago — of inspiring entrepreneurship with multi-channel commerce — and we fully expect to continue leading this industry transition for years to come.”

On the ratings front, SHOP has been the subject of a number of recent research reports. In a report issued on April 27, BTIG analyst Abhinav Kapur downgraded SHOP to Hold. On April 26, RBC’s Ross MacMillan downgraded the stock to Hold as well, and has a price target of $77.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Abhinav Kapur and Ross MacMillan have a yearly average return of 25.3% and 22% respectively. Kapur has a success rate of 83% and is ranked #1495 out of 4569 analysts, while MacMillan has a success rate of 83% and is ranked #8.

Sentiment on the street is mostly bullish on SHOP stock. Out of 12 analysts who cover the stock, 7 suggest a Buy rating and 5 recommend to Hold the stock. The 12-month average price target assigned to the stock is $72.38, which represents a potential downside of 10% from where the stock is currently trading.

Shopify, Inc. operates a cloud-based commerce platform designed for small and medium-sized businesses. Its software is used by merchants to run business across all sales channels, including web, tablet and mobile storefronts, social media storefronts, and brick-and-mortar and pop-up shops.


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