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Shopify (SHOP) Falls More Steeply Than Broader Market: What Investors Need to Know
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In the latest close session, Shopify (SHOP - Free Report) was down 4.57% at $116.78. The stock's change was less than the S&P 500's daily loss of 1.51%. At the same time, the Dow lost 0.97%, and the tech-heavy Nasdaq lost 2.01%.
The cloud-based commerce company's stock has dropped by 1.16% in the past month, exceeding the Computer and Technology sector's loss of 1.84% and the S&P 500's loss of 3.63%.
The investment community will be paying close attention to the earnings performance of Shopify in its upcoming release. The company's upcoming EPS is projected at $0.32, signifying a 28.00% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $3.08 billion, up 30.59% from the year-ago period.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.78 per share and revenue of $14.53 billion. These totals would mark changes of +52.14% and +25.72%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Shopify. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 2.83% increase. Currently, Shopify is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Shopify is currently trading at a Forward P/E ratio of 68.86. This expresses a premium compared to the average Forward P/E of 15.14 of its industry.
We can additionally observe that SHOP currently boasts a PEG ratio of 3.32. 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. Internet - Services stocks are, on average, holding a PEG ratio of 1.8 based on yesterday's closing prices.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 24% 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.
To follow SHOP in the coming trading sessions, be sure to utilize Zacks.com.
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Shopify (SHOP) Falls More Steeply Than Broader Market: What Investors Need to Know
In the latest close session, Shopify (SHOP - Free Report) was down 4.57% at $116.78. The stock's change was less than the S&P 500's daily loss of 1.51%. At the same time, the Dow lost 0.97%, and the tech-heavy Nasdaq lost 2.01%.
The cloud-based commerce company's stock has dropped by 1.16% in the past month, exceeding the Computer and Technology sector's loss of 1.84% and the S&P 500's loss of 3.63%.
The investment community will be paying close attention to the earnings performance of Shopify in its upcoming release. The company's upcoming EPS is projected at $0.32, signifying a 28.00% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $3.08 billion, up 30.59% from the year-ago period.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.78 per share and revenue of $14.53 billion. These totals would mark changes of +52.14% and +25.72%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Shopify. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 2.83% increase. Currently, Shopify is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Shopify is currently trading at a Forward P/E ratio of 68.86. This expresses a premium compared to the average Forward P/E of 15.14 of its industry.
We can additionally observe that SHOP currently boasts a PEG ratio of 3.32. 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. Internet - Services stocks are, on average, holding a PEG ratio of 1.8 based on yesterday's closing prices.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 24% 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.
To follow SHOP in the coming trading sessions, be sure to utilize Zacks.com.