ADBE edges ahead of SHOP as the stronger e-commerce bet, thanks to cloud-native upgrades and rising earnings momentum.
Shopify reported a decent quarter with 27% YoY revenue growth, beating estimates, yet losing to EPS estimates, but maintaining a buy rating and outpacing major indices. The company leverages two main businesses: subscription solutions and merchant solutions, with significant expansions into AI, B2B sales, and social commerce. Shopify's financials are robust, showing strong cash flow and meeting the rule of 50, indicating elite performance despite market volatility.
Shopify (SHOP) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.
SHOP gains momentum as merchant tools like Shop Pay drive growth and new crypto payment options expand its reach.
Shopify gains momentum as its expanding merchant base and strategic partnerships fuel optimism despite stiff competition.
Recently, Zacks.com users have been paying close attention to Shopify (SHOP). This makes it worthwhile to examine what the stock has in store.
Initiate Shopify at Strong Buy, $157 PT, driven by global Payments, POS, and enterprise expansion fueling 20%+ topline growth through FY26E. Shopify's rapid international rollout, POS innovation, and B2B/enterprise wins create durable, multi-engine growth not fully priced by the market. Valuation reflects conviction in above-consensus execution and structural resilience, with current discount offering rare entry into a persistent software compounder.
SHOP remains a great Buy at every dips, thanks to its increased cross selling and adoption of its vertically integrated headless commerce offerings. It is apparent that the management's aggressive go-to-market strategies and agility during the worst of the tariff war have paid off handsomely. This is significantly aided by SHOP's compelling high growth/ profitable cadence, along with the rich cash flow investment thesis and the healthier balance sheet.
Shopify remains a buy with a $124 price target, implying 18% upside, driven by robust GMV growth and expanding Shopify Payments penetration as it expands its merchant types across geographies. International, Offline, and Enterprise/B2B markets are key growth levers, with significant whitespace left in Shopify's $849B total addressable market. Despite macroeconomic and tariff risks, Shopify's diversified merchant base and product innovation provide resilience and stability for continued 20%+ growth every year until FY27.
Shopify's robust growth and dominant platform position support a compelling long-term outlook, with potential to double shares by 2030. Current valuation is steep at 75x forward earnings, making near-term upside dependent on consistently exceeding high expectations. Short-term risks include possible Q3 guidance disappointment and macro uncertainty, which could trigger a valuation reset.
Shopify remains a top conviction growth stock despite recent market pullback, thanks to its dominant position and long-term expansion opportunities. The company is vastly underpenetrated in a massive $849 billion global TAM, with strong revenue and GMV growth outpacing smaller rivals. Shopify's rapid AI innovation, including new tools like an automatic tariff calculator, strengthens its platform and merchant appeal.
In the most recent trading session, Shopify (SHOP) closed at $109.21, indicating a -4.31% shift from the previous trading day.