Shopify (SHOP) Gains As Market Dips: What You Should Know
Shopify (SHOP) closed at $149.54 in the latest trading session, marking a +0.91% move from the prior day. This move outpaced the S&P 500's daily loss of 0.25%. At the same time, the Dow added 0.04%, and the tech-heavy Nasdaq lost 0.53%.
Heading into today, shares of the cloud-based commerce company had gained 13.9% over the past month, outpacing the Computer and Technology sector's loss of 3.92% and the S&P 500's loss of 2.35% in that time.
Wall Street will be looking for positivity from SHOP as it approaches its next earnings report date. This is expected to be February 21, 2019. On that day, SHOP is projected to report earnings of $0.20 per share, which would represent year-over-year growth of 33.33%. 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.
Investors should also note any 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.
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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 14.72% higher within the past month. SHOP is holding a Zacks Rank of #2 (Buy) right now.
In terms of valuation, SHOP is currently trading at a Forward P/E ratio of 477.07. This valuation marks a premium compared to its industry's average Forward P/E of 32.07.
We can also see that SHOP currently has a PEG ratio of 19.08. 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. The Internet - Services industry currently had an average PEG ratio of 2.38 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 54, which puts it in the top 21% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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