Shopify (SHOP - Free Report) closed the most recent trading day at $161.06, moving +0.61% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.02%. At the same time, the Dow added 0.29%, and the tech-heavy Nasdaq lost 0.39%.
Heading into today, shares of the cloud-based commerce company had gained 12.14% over the past month, outpacing the Computer and Technology sector's gain of 0.38% and the S&P 500's loss of 2.56% in that time.
SHOP will be looking to display strength as it nears its next earnings release, which is expected to be February 21, 2019. The company is expected to report EPS of $0.20, up 33.33% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $327.13 million, up 46.82% from the year-ago period.
SHOP's full-year Zacks Consensus Estimates are calling for earnings of $0.31 per share and revenue of $1.05 billion. These results would represent year-over-year changes of +93.75% and +56.57%, respectively.
It is also important to note the recent changes to analyst estimates for SHOP. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SHOP currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that SHOP has a Forward P/E ratio of 515.38 right now. Its industry sports an average Forward P/E of 28.3, so we one might conclude that SHOP is trading at a premium comparatively.
Also, we should mention that SHOP has a PEG ratio of 20.62. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Services stocks are, on average, holding a PEG ratio of 2.26 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 80, putting it in the top 31% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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.