In the latest trading session, Shopify (SHOP) closed at $35.16, marking a +1.01% move from the previous day. This move lagged the S&P 500's daily gain of 1.06%. Elsewhere, the Dow gained 0.71%, while the tech-heavy Nasdaq added 0.09%.
Heading into today, shares of the cloud-based commerce company had lost 14.6% over the past month, lagging the Computer and Technology sector's loss of 4.33% and the S&P 500's loss of 1.14% in that time.
Shopify will be looking to display strength as it nears its next earnings release. On that day, Shopify is projected to report earnings of $0 per share, which would represent a year-over-year decline of 100%. Meanwhile, our latest consensus estimate is calling for revenue of $1.34 billion, up 19.64% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.07 per share and revenue of $5.49 billion, which would represent changes of -89.06% and +19.14%, respectively, from the prior year.
It is also important to note the 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 company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.47% higher within the past month. Shopify is holding a Zacks Rank of #5 (Strong Sell) right now.
Looking at its valuation, Shopify is holding a Forward P/E ratio of 499.93. This represents a premium compared to its industry's average Forward P/E of 21.35.
Investors should also note that SHOP has a PEG ratio of 21.73 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Services was holding an average PEG ratio of 1.81 at yesterday's closing price.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 97, putting it in the top 39% 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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Shopify Inc. (SHOP) : Free Stock Analysis Report
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