Shopify (SHOP) Gains As Market Dips: What You Should Know
Shopify (SHOP) closed at $310.05 in the latest trading session, marking a +1.09% move from the prior day. This change outpaced the S&P 500's 0.2% loss on the day. Elsewhere, the Dow lost 0.17%, while the tech-heavy Nasdaq lost 0.38%.
Prior to today's trading, shares of the cloud-based commerce company had gained 21.16% over the past month. This has outpaced the Computer and Technology sector's loss of 1.9% and the S&P 500's gain of 0.33% in that time.
Investors will be hoping for strength from SHOP as it approaches its next earnings release. In that report, analysts expect SHOP to post earnings of $0.03 per share. This would mark year-over-year growth of 50%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $350.06 million, up 42.9% from the year-ago period.
SHOP's full-year Zacks Consensus Estimates are calling for earnings of $0.55 per share and revenue of $1.51 billion. These results would represent year-over-year changes of +44.74% and +40.24%, respectively.
It is also important to note the recent changes to analyst estimates for SHOP. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 4.09% higher within the past month. SHOP is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, SHOP is holding a Forward P/E ratio of 562.15. For comparison, its industry has an average Forward P/E of 27.68, which means SHOP is trading at a premium to the group.
Meanwhile, SHOP's PEG ratio is currently 15.4. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. SHOP's industry had an average PEG ratio of 2.93 as of yesterday's close.
The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 69, which puts it in the top 27% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.