Shopify (SHOP – Free Report) closed at $109.96 in the latest trading session, marking a -0.2% move from the prior day. The stock’s performance was behind the S&P 500’s daily loss of 0.04%. On the other hand, the Dow registered a gain of 0.07%, and the technology-centric Nasdaq decreased by 0.05%.
The cloud-based commerce company’s shares have seen a decrease of 2.1% over the last month, not keeping up with the Computer and Technology sector’s gain of 5.93% and the S&P 500’s gain of 1.05%.
The investment community will be closely monitoring the performance of Shopify in its forthcoming earnings report. On that day, Shopify is projected to report earnings of $0.43 per share, which would represent year-over-year growth of 26.47%. Alongside, our most recent consensus estimate is anticipating revenue of $2.72 billion, indicating a 27.03% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $1.25 per share and a revenue of $8.77 billion, demonstrating changes of +68.92% and +24.28%, respectively, from the preceding year.
It’s also important for investors to be aware of any recent modifications to analyst estimates for Shopify. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the company’s business health and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.54% higher. Shopify presently features a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that Shopify has a Forward P/E ratio of 87.91 right now. This denotes a premium relative to the industry’s average Forward P/E of 24.54.
We can additionally observe that SHOP currently boasts a PEG ratio of 2.06. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company’s anticipated earnings growth rate. As of the close of trade yesterday, the Internet – Services industry held an average PEG ratio of 2.06.
The Internet – Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 36, putting it in the top 15% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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