|Bid||340.50 x 900|
|Ask||340.56 x 900|
|Day's Range||328.67 - 343.45|
|52 Week Range||117.64 - 409.61|
|Beta (3Y Monthly)||1.24|
|PE Ratio (TTM)||N/A|
|Earnings Date||Oct 29, 2019|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||362.04|
Shopify (NYSE:SHOP) stock has plateaued. SHOP had a massive run-up, as Shopify stock more than tripled in eight months. However, SHOP stock pulled back dramatically in August and has traded in a range since that time.Source: justplay1412 / Shutterstock.com Now many wonder what SHOP stock will do next. Will it retest its all-time high of $409.61 per share or will it resume its decline? Imagine the UnimaginableShopify stock is a long-term winner. However, the owners of SHOP stock have a lot to worry about in both the short and the medium term. InvestorPlace contributor Luke Lango, a SHOP bull, described the recent 23% decline since August as a normal, healthy pullback. Stocks that are in a longer-term rally commonly undergo such declines, and he may well be correct.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 A-Rated Stocks to Buy for the Rest of 2019 However, the behavior of SHOP stock could also serve as a reminder that the "unimaginable" routinely occurs in the stock market. Unfortunately, SHOP stock is poised for a massive drop if investors' sentiment turns negative.Shopify stock still trades at 330 times its forward earnings. At that level, it would have to fall almost 90% from its all-time high before it would no longer be overvalued by traditional standards.But such drops happen even to even to solid companies. In September of last year, many thought Nvidia (NASDAQ:NVDA) could do no wrong as NVDA stock climbed north of $290 per share. I can also remember when people thought the same about Cisco (NASDAQ:CSCO). At one point in early 2000, CSCO rose above $80 per share, briefly becoming the world's most valuable stock.However, NVDA stock lost about 60% in less than three months last year. Cisco would go on to lose 90% of its value over two years as the tech boom went bust. Nearly 20 years later, CSCO stock has not yet regained its all-time high. Competitors, Economy Could Hurt ShopifyBut is it possible that those who are bullish on SHOP stock will be proven correct? Of course. The unimaginable happens every day. InvestorPlace contributor and Shopify stock bull Nicolas Chahine predicts that, "the breakout in either direction will be strong." I agree with his assertion.Still, many signs indicate that SHOP stock cannot continue to trade at such high valuations. Unlike some other stocks that have broken out to the same extent, Shopify has competition. WordPress developers tend to gravitate toward WooCommerce. Adobe's (NASDAQ:ADBE) purchase of Magento has made ADBE a competitor of SHOP.Furthermore, if a recession occurs, it will probably hit the small and medium-sized business that Shopify serves will be especially hard-hit. Shopify could attract new business as unemployed workers scramble for a way to earn money. However, that turnover will create uncertainty that could lead investors to question the high valuation of SHOP stock. How to Trade SHOP StockSHOP stock could move back to its record high or even beyond.But Shopify stock looks like a bubble. Virtually no company can justify a 330 forward price-earnings ratio, regardless of its performance. Investors also need to remember that even the seemingly most solid of companies can lose almost all of their value.Despite the high price of Shopify stock, I see SHOP as a long-term winner. Even with the rising competition in the e-commerce space, businesses often choose SHOP when they want an e-commerce platform that's not tied to Amazon or other large tech firms. Although a recession could disrupt the company's growth for awhile, its business has just scratched the surface of its potential, given the explosive outlook of e-commerce. Shopify will benefit as more businesses utilize e-commerce.Unfortunately, in light of the sky-high valuation of SHOP stock, investors do not know whether these catalysts will boost SHOP stock within several days or several years. That makes SHOP too risky to buy at its current levels.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Super Boring Stocks to Buy With Super Safe Returns * 10 Winning Stocks to Buy and Stick With for the Long Haul * Don't Give Up on These 4 Cannabis Stocks The post Shopify Stock Has Become a Bubble appeared first on InvestorPlace.
Like so many other IPO stocks, Lyft (NASDAQ:LYFT) keeps falling. The LYFT stock price, just over $38, is barely half its IPO price of $72. The declines have been particularly nasty of late, with LYFT down 42% from highs on Aug. 8, the day after what looked like a solid second quarter earnings report.Source: Tero Vesalainen / Shutterstock.com Admittedly, LYFT does look intriguing here. It's easy to forget amid the carnage in recent IPOs that Q2 earnings really were better than expected. The company raised full year guidance for revenue and lowered its outlook for Adjusted EBITDA loss.Combined with disappointing results from rival Uber (NYSE:UBER), the quarter suggests that Lyft is taking market share. Meanwhile, valuation at least looks more reasonable after the nearly 50% haircut.InvestorPlace - Stock Market News, Stock Advice & Trading TipsEV/revenue of about 2.4x isn't quite as cheap as it sounds given lower margins than other tech companies valued on a top-line basis. But using "contribution margin" -- basically, adjusted gross profit -- LYFT is trading at about 6x gross profit. The combination of a single-digit EV/GP valuation and 72% revenue growth, as Lyft posted in Q2, isn't found in too many places in this market. The recent (albeit unproven) bottom in the LYFT stock price suggests at least some investors see value here.But there are problems with assuming that LYFT is a "buy the dip" candidate. I believe it might be at some point. I don't believe that point has arrived. LYFT and the Private Market ProblemMany IPO stocks this year have plunged. LYFT is down almost half from its IPO price, and UBER 36%. Chewy (NYSE:CHWY) and Peloton Interactive (NASDAQ:PTON) are underwater. Slack Technologies (NYSE:WORK), until a recent bounce, had traded almost straight down after its direct listing.The narrative has been that investors suddenly decided to stop buying unprofitable growth stocks. And trading in already-public names like Shopify (NYSE:SHOP) and Roku (NASDAQ:ROKU), plus the carnage among cannabis stocks, does suggest that valuation finally has become a point of focus.What's tempting about the narrative is that, presumably, sentiment can reverse. After all, growth has sharply outperformed value in this bull market, and after a pause, may well do so again.But there's something else going on with the recent batch of IPOs beyond just a lack of profitability. It seems increasingly clear in retrospect that the private markets that funded those companies before the IPO were in a bit of a bubble. The presence of Softbank (OTCMKTS:SFTBY) alone seems to have boosted valuations, as evidenced by its primary role in the WeWork debacle.Softbank aside, private markets saw a flood of 'dumb money' from pension funds, mutual funds, family offices, and other investors chasing the "unicorn" boom. The flood led to ever-increasing valuations, based often on relatively small equity injections.Those valuations went too far. And so the problem with a company like Lyft isn't necessarily that investors decided to knock the valuation down to a current ~$8 billion (excluding net cash). It's that the $15 billion valuation assigned last year was too high. Those late-stage investors, quite simply, didn't know what they were doing. They created false expectations that public investors would pay even more. It's now clear they won't. Two Key Questions for the LYFT Stock PriceAnd so it's a poor argument to bet on LYFT simply because it's cheaper than it was. It shouldn't have had a $20 billion-plus valuation. It's thus dangerous to hope that the LYFT stock price will follow that of Facebook (NASDAQ:FB) and Snap (NYSE:SNAP). Both of those companies saw steep post-IPO drawdowns -- which were followed by multi-bagger rallies. Lyft's inflated private valuation suggests that path is much less likely.There are two key fundamental worries. The first, as I noted after the LYFT IPO back in May, is the company's relatively modest growth in rides per user. The argument for big upside in both LYFT stock and UBER is based on the companies taking an increasing share of overall transportation. Simply splitting the existing taxi market isn't enough.Lyft didn't break out figures after Q2. On the Q2 call, CFO Brian Roberts said that rides did outpace the growth in riders. In other words, rides per user increased. But it's likely the increase was small -- or else Lyft would have been trumpeting the figure, not ignoring it.Given profitability concerns for both ridesharing companies, the increase almost certainly isn't enough. Lyft can get to profitability, but that alone doesn't support a ~$8 billion enterprise value.Those profitability concerns also go to the question I've asked about UBER: is ridesharing really a profitable model? Investors have worries. Uber's efforts in delivery and freight are one reason why I thought UBER would outperform LYFT -- and despite declines in both stocks, it has.But incremental margins in ridesharing simply may not be as high as hoped -- which means profitability may be further off, and the LYFT stock price may well have even further to fall. All told, investors looking to buy the dip need to have faith in both the model and in management.As of this writing, Vince Martin is long CHWY. He has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Super Boring Stocks to Buy With Super Safe Returns * 10 Winning Stocks to Buy and Stick With for the Long Haul * Don't Give Up on These 4 Cannabis Stocks The post Cheaper Doesn't Mean Cheap for Lyft Stock appeared first on InvestorPlace.
Shares of Okta (NASDAQ:OKTA) have been under severe pressure, as high-growth stocks are getting hammered. Whether good, bad or mediocre, these stocks are being tossed out the window. Okta stock is in that group, as shares fell 34% from peak to trough in just two months.Source: Michael Vi / Shutterstock.com It's got some investors looking for an opportunity in the name, while others are waiting for the next shoe to drop. Unfortunately, the main driver for the growth stock group may be the overall market.The S&P 500, Nasdaq and Dow Jones are no more than 5% off their highs. Should they see even moderate selling pressure -- say, down 7% to 10% from their highs -- individual stocks will likely take another beating.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOn the flip side, should the major indices push back to new highs, investors will likely feel confident enough to circle back to these names now that most of them are down 20% or more. Valuing Okta StockAfter the recent decline, we've started to see some life in this group once again. Shopify (NASDAQ:SHOP) broke below $300, then reclaimed it, rallying to around $50 per share from its lows. Roku (NASDAQ:ROKU) jumped almost 10% on Wednesday after an analyst upgrade. After breaching the 200-day moving average, Okta stock has recovered nicely as well, up about 25% from the lows. * 10 Super Boring Stocks to Buy With Super Safe Returns So, has this group bottomed? Perhaps. But I wouldn't be surprised by a retest or a near-retest of the recent lows.When we see a massive rally like we did in Okta Inc stock -- a triple from the fourth-quarter lows -- followed by a catastrophic unwind, these stocks need time to build bases. I can't say confidently whether the latest shakeout has been enough or not. However, my biggest issue with OKTA is the valuation.Last quarter, OKTA delivered a beat across the board. Earnings, revenue and management's outlook for next quarter and the full year were impressive. As such, full-year expectations now call for 41% revenue growth this year to $562.86 million.While the growth rate is impressive, we're still talking about a stock with a $14.1 billion market cap. That's 25-times current sales!Say estimates of 34% revenue growth next year are too conservative, and Okta again grows revenue past 40%, say to $800 million. That's great, but we're still talking about 17.6-times forward sales at present value.And remember, I'm no perma-bear on Okta. This was one of my favorite mid-cap stocks earlier this year. This group has performed incredibly well, even considering the big correction.On the plus side, OKTA recently turned free cash flow (FCF) positive, while gross margins and gross profit continue to surge. On the downside, it's not yet profitable and FCF is barely more than breakeven. Trading OKTA SharesOkta stock will rally eventually, but that doesn't calm investors' worries about the valuation. The question then becomes, when will names like Okta, Alteryx (NASDAQ:AYX), Veeva Systems (NASDAQ:VEEV), Shopify and others come to more realistic levels?For instance, when will the price-to-sales ratios drop from the mid-20s to the teens? Not that that's cheap, but it's at least palatable. For Okta stock, that would drop the stock about 30% from current levels, based on fiscal 2020 (this year's) sales. That would put shares more than 10 points below the September low, landing it down near $82.50. Click to EnlargeCurrently, shares are trading just under $120, as the 50-day moving average and 78.6% retracement keep a lid on Okta stock. Over $120 and OKTA may accelerate higher.If this level holds shares in check, bulls need to see the 200-day moving average and the 61.8% retracement hold as support. If they fail, the September low near $93.50 is on the table.So, is Okta Inc stock safe to buy yet?For me, I like to see huge washouts in high-growth names once they've lost momentum. Specifically, I look for reductions exceeding 40%, like we've now seen in Roku. Specifically, with Okta, I would really like to see the stock decline more before initiating it as more than a trade.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long ROKU. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Super Boring Stocks to Buy With Super Safe Returns * 10 Winning Stocks to Buy and Stick With for the Long Haul * Don't Give Up on These 4 Cannabis Stocks The post Is Okta Stock Too Dangerous to Own? appeared first on InvestorPlace.
As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the second quarter. We get to see hedge funds' thoughts towards the market and […]
Shopify has been a huge winner in 2019. Earnings are booming and the company plans to compete more with Amazon. But with software stocks under pressure, is SHOP stock a buy now?
Shopify Inc. , the leading multi-channel commerce platform, plans to announce financial results for its third quarter ended September 30, 2019 before markets open on Tuesday, October 29, 2019.
During Thursday night's Mad Money program Jim Cramer reminded viewers not to forget about Shopify , which investors can start accumulating as it's well off its highs. In this daily bar chart of SHOP, below, we can see that prices have come down from their highs and have stabilized around the $300 area. Prices are below the declining 50-day simple moving average line.
Shopify (NYSE:SHOP) stock is down 20% in the past month. SHOP stock slid from $389.70 at the open on Sept. 3 to $310.36 at the close on Oct. 2.Prior to that, SHOP stock had been rallying tremendously. SHOP stock nearly tripled in value from January to August. As a result, the shares reached a frothy valuation.As I wrote in my July column, "Short term, SHOP stock is a sell. A massive pullback could signal a buying opportunity to place a bet on SHOP's future prospects. But until then, investors should be cautious before chasing this growth story."InvestorPlace - Stock Market News, Stock Advice & Trading Tips * Are These 10 High-Yielding S&P Dividend Stocks Traps or Treasures? I was a little early. The shares went up another 27% before starting their retreat back down to the $300 price level.While I believe SHOP remains overvalued, I can see the stock treading water or rallying higher.But here's why I'm on the sidelines with Shopify stock: Source: justplay1412 / Shutterstock.com Will SHOP's Fulfillment Push Move the Needle?SHOP is rapidly moving into fulfillment.The company believes that will help it compete more effectively with Amazon (NASDAQ:AMZN). But fulfillment is not a slam-dunk. The fulfillment industry is a low-margin business. Since it also has high startup costs, SHOP could lose big if this bet doesn't pay off. Considering the company has yet to generate a profit from its core business, it could be getting in over its head.In tandem with this fulfillment push, Shopify is acquiring 6 River Systems. 6 Rivers provides automation solutions for warehouse/fulfillment operations. The analyst community is positive on this deal. Canaccord's David Hynes believes the acquisition can jump-start SHOP's fulfillment strategy. He remains bullish on Shopify stock, setting a $385 price target on the name.Jeffries' Samad Samana believes another strength of the deal is that it brings two former Amazon execs into the fold. But Samana remains cautious, rating the stock a "hold." Piper Jaffray's Michael Olson is also positive on the acquisition, but remains "neutral" on Shopify stock, due to its valuation.Shopify's move into fulfillment has its pros and cons. But weighing catalysts against risks, I think SHOP stock remains highly overvalued. Let's take a closer look at the current valuation of Shopify stock. Even After Its Dip, Shopify Stock Remains OvervaluedEven compared to other growth stocks, SHOP is overvalued. Shopify's trailing enterprise value/sales (EV/Sales) ratio is 26.2. Here are the 12-month trailing EV/Sales ratios for some of Shopify's peers:Amazon: EV/Sales of 3.5Etsy (NASDAQ:ETSY): EV/Sales ratio of 8.9PayPal Holdings (NASDAQ:PYPL): EV/Sales ratio of 6.9Square (NYSE:SQ): EV/Sales ratio of 6.5Wix (NASDAQ:WIX): EV/Sales ratio of 8.1Perhaps comparing Shopify stock to AMZN, PYPL, and SQ is not an apples-to-apples contrast. But even among e-commerce platforms, Shopify's valuation is high. InvestorPlace columnist Mark Hake touched on this in a recent article. He pointed out that Shopify stock trades at a substantial premium to ETSY and WIX, even when comparing their forward sales.For the fiscal year that will end in December 2020, analysts, on average, estimate that Shopify's sales will be $2.06 billion. Based on its current enterprise value of $33.9 billion, SHOP trades at a forward EV/Sales ratio of 16.4. ETSY and WIX have forward EV/Sales ratios of 6.3 and 5.8, respectively.But SHOP continues to fly high in terms of growth. As its last quarterly results showed, its revenue continues to grow at a significant clip. The growth of e-commerce is definitely not over. But does it seem smart to buy SHOP stock now, when the company is entering the costly fulfillment business?The same thing could have been said about Amazon back in the mid-2000s. Back then, there was no guarantee that AMZN could parlay its success as a bookseller into a global retail juggernaut. Only time will tell if SHOP will achieve the same success. The Bottom Line on Shopify Stock: Its Future Is UncertainShopify's core software-as-a-service business is solid. Its competitive moat will enable it to sustain high growth, as its customers accelerate their pivot from bricks-and-mortar to e-commerce. But SHOP stock is not a buy at any price. At its current valuation, Sjopify stock seems frothy. Add in the new fulfillment build-out, and its future profitability continues to be uncertain.All bets are off with SHOP. The company's next quarterly results are due to be released in November. If the company can continue to generate 30%+ revenue growth, investors could dive into SHOP stock again.But buying SHOP today could be a costly bet. The best strategy for investors is to remain on the sidelines. Once the anticipated recession occurs, Shopify could be a screaming buy. Even if its growth is challenged in a tough economy, the company's long-term prospects may make it a compelling opportunity.As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Best ETFs for 2019: The Race Is a Little More Gnarly Now * 7 Next-Generation Healthcare Stocks to Buy * Are These 10 High-Yielding S&P Dividend Stocks Traps or Treasures? The post Down 20% in a Month, Shopify Stock Isn't Worth Buying Yet appeared first on InvestorPlace.
Investors are cautious about an upcoming slowdown. As expected, tech stocks like Cisco, Shopify, Alteryx, and others have led the sell-off.
It might be of some concern to shareholders to see the Shopify Inc. (NYSE:SHOP) share price down 19% in the last...
(Bloomberg) -- The best performing sector in Canada has lost its mojo.After eight straight months in the green, tech stocks are now on pace for their first slump this year with about C$8.3 billion ($6 billion) in market value lost -- making them the biggest losers in September.The rotation to value from growth sent stocks like Shopify Inc. on its longest losing streak on record. There was also BlackBerry Ltd.’s 30% collapse last week after reporting a massive earnings miss and forecast cut. Shopify makes up a whopping 35% of the S&P/TSX Information Technology Index, while BlackBerry has about a 3% weighting. The slump in FAANG stocks after U.S. President Donald Trump’s negative remarks about the growing power of social media platforms seeped into investor sentiment for Canadian tech too.“The pace of this recent run in technology stocks, driven in large part by the success of Shopify, was unsustainable, and likely driven in part by short covering,” said Hans Albrecht, fund manager at Toronto-based Horizons ETFs Management Canada Inc. “When that dried up the bottom fell out.”Was the epic 59% rally into August too good to be true? Sky-high valuations have slipped with the selloff but are still well above the five-year average. Shopify, which has found profit elusive, carries a forward 12-month price-earnings ratio of about 466, according to data compiled by Bloomberg.The slump may have also knocked Canadian pride down a peg or two. Shopify, along with Lightspeed POS Inc., whose shares have slumped about 38% since hitting a peak in August after pulling off one of the most successful initial public offerings in North America this year, have been held up as exhibit A and B that the country really can do tech.“Is this the end of the run for tech? Absolutely not,” Albrecht said. Unlike the U.S., Canada has a handful of tech stocks that make up a small part of the broader S&P/TSX Composite Index, pushing valuations up at an accelerated pace. “This year’s run had valuations overextend and invariably investors realize that fundamentals need to catch up at least to some extent.” The tech rally could take a pause for now and push ahead in 2020, he added.Despite the flight to value this month -- boosting heavyweights like financial and energy stocks -- last week painted a different picture -- stocks snapped their longest winning streak since April and have lost 1.2% amid political turmoil in the U.S. and evidence of slower growth in Europe.Here’s a look at what happened last week:Markets -- Just The NumbersChart of The WeekPoliticsThe federal election campaign continues in Canada as party leaders pledge tax breaks, cost reductions and corporate subsidies:Prime Minister Justin Trudeau has promised a major personal income tax break if re-elected as he tries to recover from revelations he wore blackface makeup on multiple occasions.Conservative Leader Andrew Scheer said he would “fix” the mortgage stress test if elected by reviewing it for first-time homebuyers and removing it from renewalsCanadian telcos slumped last week as Trudeau vowed to cut wireless services costs by 25% within four years. This came after the New Democratic Party indicated that it would implement price caps on mobile phone and internet services.EconomyIt was quiet on the data front with Canada’s July wholesale sales rising 1.7% to C$65.4 billion, surpassing expectations. The blockbuster figures that economists will be watching out for is July GDP data expected on Oct. 1. This comes ahead of Bank of Canada’s monetary policy decision on Oct. 30.TrendingInCanada1\. The global climate strike took place across Canada as protesters pushed politicians to adopt a climate action plan to reduce carbon dioxide emissions. Environmental activist Greta Thunberg joined the march in Montreal on Friday.Read more: Greta Thunberg Is Right, World Leaders Say, We Are Failing2\. Toronto Maple Leafs star Auston Matthews faces a disorderly conduct charge after he mooned a female security guard in Arizona.\--With assistance from Yueqi Yang and Esteban Duarte.To contact the reporter on this story: Divya Balji in Toronto at firstname.lastname@example.orgTo contact the editors responsible for this story: Madeleine Lim at email@example.com, Jacqueline Thorpe, David ScanlanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- The founder of software company Lightspeed POS Inc. has made it easy to check progress in his mission to create Canada’s next great technology company.Beneath the vaulted ceilings of a converted rail hotel in Montreal, Dax Dasilva has hung screens showing minute-by-minute information on everything from website views to new customers.The fixation on data has led to one of North America’s most successful initial public offerings this year. Now the pressure is on for Dasilva to keep the momentum going. That’s no easy feat when you have shareholders with different priorities.“Our Canadian investors would like to see profitability sooner and the American investors would like to see growth, more growth,” the 43-year-old chief executive officer said in an interview at his office.The company, whose point of sale software helps small businesses manage things like inventory and online transactions, is addressing “both sides of the coin,” he said. Spotting when data trends in the wrong direction is part of the strategy.Investors are banking on Lightspeed’s ability to sign up thousands of new clients among retailers and restaurants, a market the company says is worth $113 billion. The stock has doubled since the March IPO, propelling the company’s enterprise value as a share of projected sales -- a closely watched ratio in the industry -- above that of peers including payment-based Square Inc. and web development platform Wix.com.The road has gotten bumpier of late. Shares have lost about a third of their value since reaching a record on Aug. 9, partly due to investors’ shift from growth to value stocks this month. They also fell in August, when Dasilva, pension fund Caisse de Depot et Placement du Quebec, and venture capital firm Inovia Capital jointly trimmed their stakes after IPO-related restrictions lifted.The top shareholders say they’re in for the long run, supporting Dasilva as he tries to emulate the success of Shopify Inc., the $36 billion e-commerce juggernaut and Canada’s tech pride. The two companies once had a partnership and now offer some competing services, though transactions at Lightspeed’s clients tend to be bigger.Lightspeed’s market value of C$2.7 billion is still less than a one-tenth the size of Shopify, as is its revenue.“A lot of large institutions missed Shopify, so they see Lightspeed as the second entrant into the marketplace,” said Thomas Birch, who oversees private equity venture capital funds and technology investments in Quebec for the Caisse, which owns about 31%. “They’re prepared to potentially pay a premium today because they know that Lightspeed is going to grow incessantly over the next five years.”The company, which derives most of its revenue from clients’ monthly payments for its cloud-based technology, is predicting sales will jump as much as 48% this fiscal year. That’s up from 36% last year, as it expands its foothold overseas and adds payment processing to its offerings.Dasilva has no official target date for turning a profit, though he’s made progress on the growth front. The company bought two smaller rivals this year, bringing acquisitions to seven since its 2005 inception and gaining customers in Europe and the golf course industry.About half of its global workforce of 800 people works at the castle-like headquarters, where exposed brick and giant wooden beams frame artwork, sleek chairs and counters. Dasilva took art history and religious studies in college after dropping out as a computer science major.With Lightspeed’s roughly $190 million in cash on hand at the end of last quarter, the Vancouver native is eyeing more acquisitions. He’s also boosting spending on marketing and ads to get the attention of entrepreneurs in the early stages of setting up a business.He can draw from an experienced board, including Chairman Patrick Pichette, a general partner at Inovia, who oversaw dozens of acquisitions as Google’s former chief financial officer.There’s room to grow. Lightspeed has about 0.1% of the addressable market of 47 million small and medium businesses and restaurants worldwide.Retail ChangesThe retail industry is moving away from stationary checkout terminals and on-location servers to modern point of sale systems like Lightspeed’s that are cheaper, web-based, and can be used on mobile devices. They can also offer tools and data and integrate online sales. The industry is growing at twice the pace of the legacy system and will surpass it in size by 2027-28, according to U.S. research firm Global Market Insights.Etiket, a beauty store and spa in Montreal which also sells niche fragrances and skin care products online, signed up for Lightspeed’s accounting, e-commerce and analytics on top of the basic point of sale package. It may add payments next, when the service becomes available in Canada.“It’s integrated and that’s one less problem,” Etiket co-owner Simon Tooley said. The trade off is you have “all your eggs in one basket” if something goes wrong, he said.Payments PushPayments is new territory for Lightspeed and investors are watching how fast businesses embrace the service, which collects a percentage of every transaction. In the U.S., where Lightspeed introduced the option about eight months ago, almost half of new retail clients subscribed in the most recent quarter.Now the company needs to show it can deploy the service worldwide and weather competition from deep-pocketed payment processors, according to a note by Raymond James analyst Steven Li.“Going public was about building reputation and visibility, and having the capacity to grow--not about just giving liquidity to investors,” Inovia co-founder Chris Arsenault said. “Canada is very young in terms of building huge companies in our own backyard. We’ve lagged and now we’re just starting to catch up.”Dasilva, the son of Ugandan immigrants of Goan descent, provides another inspiration for Canada’s entrepreneurs, following Ottawa-based Shopify’s 1,750% growth since its 2015 trading debut.One of the few openly gay CEOs in Canada, Dasilva is also an atypical figure in tech who set up a cultural center in Montreal and recently released a book infused with spirituality.“They blazed the trail; we have as well,” Dasilva said of Shopify. “I talk to more tech companies in Canada that are thinking bigger as a result.”\--With assistance from Divya Balji and Doug Alexander.To contact the reporter on this story: Sandrine Rastello in Montreal at firstname.lastname@example.orgTo contact the editors responsible for this story: David Scanlan at email@example.com, Jacqueline ThorpeFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Data analytics company Alteryx (AYX) is down over 5% today. Several tech stocks have corrected significantly this month. Let's take a closer look.
Technology stocks such as Shopify were on fire in this year's first half. However, market weakness and valuation concerns hurt tech stocks this month.
While marijuana is never not being talked about in the financial news somewhere, it's become a hot topic again on Wall Street as Canada gets ready to legalize marijuana edibles, beverages, extracts and lotions on October 17. The products should be available for purchase around mid-December.Source: Shutterstock That's fantastic!Now, according to Arcview Market Research, by 2022, the cannabis edibles market could be worth a whopping $4.1 billion in Canada and the United States. So, it's no surprise that investors are trying to figure out the best way to play this rising trend.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIn fact, I was recently asked if investors should buy marijuana stocks now or wait until we see profits. My answer? Wait.Two of the big pure-plays on marijuana, Canopy Growth Corporation (NYSE:CGC) and Aurora Cannabis Inc. (NYSE:ACB), have seen their growth slow in their most-recent earnings quarters. That's the opposite of what you want in a company you're investing in!To be honest, I don't see the cannabis side of the marijuana business being the big winner. In fact, I look for it to shrink.With marijuana legal on a recreational level in Canada and the U.S. getting closer to following suit, a lot of folks can try it now. But smoking marijuana is not "one size fits all." There's a lot of varieties and differences in experience when it comes to smoking marijuana, and nothing has been settled on what works best for the marketplace. Clearly, there's still a lot that needs to be worked out there.There's also the blowback from vaping. The CDC announced yesterday that there are now 530 cases of lung injury tied to vaping -- a 39% increase from the 380 cases reported just a week ago. They believe that the illness is due to vaping THC, nicotine or a mix between the two. Many patients have wound up in the hospital, and so far, seven have died. There's also concern over not knowing what the long-term effects of vaping will be. So, this does not bode well for the smoking side of the business.Instead, I look for the CBD oil market to grow over the long term. However, there are still some issues here, too.Now, this might come as a surprise, but every weekend I bicycle with a guy who owns a big hemp farm and is in the hemp seed business. While hemp is perfectly legal in all 50 states of the U.S., states like Idaho might see him as being in the pot business.You see, cannabis seeds are both male and female. The female plants without seeds have higher THC levels, while the male cannabis plants have much less. However, sometimes they change their gender, and if a grower gets too much female in the hemp, they have to basically burn it off, and there goes their crop.The other problem with CBD oil is the quality is very mixed. I have anesthesiologist clients who swear by it, but they can't get the quality they want. But once that's fixed, CBD could be a huge business.Now, I know what you're thinking: Louie, does this mean you're completely against the marijuana space? Investing in the "Legit" Marijuana CompaniesAbsolutely not. I just prefer to focus on the companies that have already proven their profitability with track records of solid growth. The "legit" ones, if you will.For example, in my Accelerated Profits service, I recommended Shopify, Inc. (NYSE:SHOP), a Canadian company, back in January. This company offers a "hassle-free" platform to other retail businesses, giving them space to build their brand and sell their products. It benefited from the legalization of cannabis in Canada, thanks to the surge in online shopping for cannabis.At the time of my recommendation, the company had posted an average 211.7% earnings surprise in the past four quarters.The result for my subscribers? We locked in a solid 46% profit in just three months.SHOP isn't the only company I've recommended in this sector. In Breakthrough Stocks, we currently have Innovative Industrial Properties, Inc. (NYSE:IIPR) on the Breakthrough Stocks Buy List. It's the only publicly traded cannabis real estate investment trust (REIT). The stock boasts a strong 2.3% dividend yield.There are two big factors that make IIPR so special. The first is that because it's a REIT, it's required to return at least 90% of its taxable income to shareholders in the form dividends. In fact, IIPR will pay its third-quarter dividend of $0.78 on October 15. All shareholders of record on September 30 will receive the dividend.The second is that it's not a pure play, either. You see, Innovative Industrial Properties has never grown, processed or sold a single marijuana product. Rather, it leases facilities to medical cannabis providers. Basically, it's the landlord of the pot growers.And it's continued to grow nicely. In the second quarter, property acquisitions helped the REIT achieve triple-digit revenue growth. IIPR acquired 10 properties between April and June, as well as another four properties in July. Year to date, the REIT has acquired 15 properties for about $167.3 million, and it currently owns 26 properties in 12 states.For the second quarter, revenues surged 159.4% year-over-year to $8.3 million, up from $3.2 million in the same quarter a year ago. Earnings per share soared 76.5% year-over-year to $0.30. The consensus estimate called for earnings of $0.29 per share on $8.34 million in revenue, so IIPR posted a 3.4% earnings surprise and a slight sales miss. Looking forward, though, IIPR's earnings are forecast to grow 123.8%Now, this is a volatile stock, and after hitting 52-week high after 52-week high, its shares are now trading well below those levels. However, I see the pullback as an excellent buying opportunity, because as the demand for marijuana and cannabis rises, so will the need for the properties to grow the plant. I'm such a big fan of this stock that it's one of my Top 5 Stocks on my Breakthrough Stocks Buy List.However, it's all about buying at the right price, as you never want to overpay for a stock. So, you can get my buy limit for IIPR here. Also, I recently shared my latest thoughts on IIPR in the Sept. 20 Breakthrough Stocks Weekly Update, so make sure to sign up here for all the details.Louis Navellier is a renowned growth investor. He is the editor of four investing newsletters: Growth Investor, Breakthrough Stocks, Accelerated Profits and Platinum Growth. His most popular service, Growth Investor, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy Under $10 * 30 Marijuana Stocks to Buy as the Future Turns Green * 7 Consumer Stocks Ready to Rally Hard The post Why You Should Wait to Buy Marijuana Stocks appeared first on InvestorPlace.
So much for quiet. After a rather boring Monday, investors were introduced to an increase in volatility. The S&P 500 dumped 1% at one point as investors try to get positioned ahead of the fourth quarter. Here are a few top stock trades. Top Stock Trades for Tomorrow 1: AmazonAmazon (NASDAQ:AMZN) has looked very pedestrian lately and Tuesday's decline didn't help matters. Shares are breaking below key uptrend support (blue line), as well as the 200-day moving average.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy Under $10 Now at $1,750, shares are teetering on the 50-week moving average (not shown on the daily chart above). Should the selling pressure intensify, look for a test of the June lows near $1,675. Below could usher in sub-$1,600.If AMZN is able to reclaim the 200-day moving average, look for a potential rebound up to the 50-day moving average. Top Stock Trades for Tomorrow 2: Cronos GroupWhat can we say about Cronos Group (NASDAQ:CRON) at this point? The cannabis trade has been a disaster and once $14 support gave way -- as we highlighted at the time -- the bears have been in control.On Tuesday CRON broke to new 2019 lows. I'm not sure if it will retest its 52-week lows near $6.50 or not at this point.This is a falling knife and bulls need to see some firming up action before even considering getting long. Either some sort of reversal, or reclaiming of notable levels like the 23.6% retracement or the 20-day moving average. Otherwise, lower prices are needed for it to be more interesting. Top Stock Trades for Tomorrow 3: TeslaTesla (NASDAQ:TSLA) was hammered on Tuesday, falling more than 7% at one point. Amid its decline, the 20-day and 50-day moving average both failed as support. That's reason for some caution.There should be some support between $210 and $220, but traders may consider waiting it out with Tesla.Meaning that if support holds, TSLA stock should rebound to the 50-day moving average. If it reclaims the 50-day, it puts higher prices on the table. If the 50-day is resistance, then another test of support is in order.Should support fail at $210, sub-$200 is on the table with $180 being a possibility in that event.Let price guide the way. Top Stock Trades for Tomorrow 4: ShopifyWe caught a $20 bounce in Shopify (NASDAQ:SHOP) when shares bounced from $340 support to $360. However, bulls are now staring at sub-$300 prices.As my own personal rule of thumb, I start to look at many of these growth names when they're down 35% to 40%. That may be a dumb rule, I'm not really sure. But it serves me well in instances involving stocks like Apple (NASDAQ:AAPL), Amazon and others. Roku (NASDAQ:ROKU) is there now.At $266, SHOP stock will be down 35%, and down 40% at $245.When these big momentum trades unwind, they're almost impossible to time correctly. If the selling keeps up, an eventual test of the 200-day moving average may be in the cards.The chart above does not suggest a clean trading environment, but it does offer levels that long-term investors may consider accumulating some additional shares. Top Stock Trades for Tomorrow 5: BlackBerryHow disappointing has BlackBerry (NYSE:BB) been? Shares are down more than 20% on the day after underwhelming quarterly results. * 7 Stocks to Buy Under $10 Vital support at $6.50 has given way. Let's see how BB does on a rebound to this spot. If it reclaims $6.50, bulls have a case on the long side. If it fails and $6.50 acts as resistance, bears are still in control.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL and ROKU. The post 5 Top Stock Trades for Wednesday: AMZN, CRON, TSLA appeared first on InvestorPlace.