Shopify Stock Forecast: Why Shopify Has Bloated Valuation

motek 1The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology – Senior Analyst at I Know First.

Summary

  • There’s an ongoing global pandemic and yet Shopify touts a YTD price return of 86.77%. This is in spite of Shopify’s continuing net losses.
  • The rapid ascent of SHOP this year has given it bloated valuation ratios. This goes to show that investors strongly believe in the momentum growth potential of Shopify.
  • Shopify now touts a TTM Price/Valuation ratio of 49.21. This is much higher than Adobe’s 16.31. Adobe is the parent firm of Shopify’s rival, Magento.
  • The super optimism over SHOP is due to its outstanding 5-year revenue CAGR of 69.48%. Profitability will eventually come to Shopify once it reaches peak maturity.
  • Shopify has a healthy balance sheet. Its total cash is $2.36 billion and has no debt. Shopify can therefore a few more quarters of negative levered free cash flow.

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Shopify Stock Forecast: A Real Example on How to Capitalize on Future Retail Trends

This article was written by Michael Shpits, a Financial Analyst at I Know First.

Summary:

  • Shopify stock saw strong growth from coronavirus lockdowns increasing ecommerce traffic amid decreased brick-and-mortar retail sales.
  • Global retail trends see vast increase in ecommerce sales to the detriment of traditional retail locations both prior to and during the coronavirus pandemic.
  • New tools for merchants including business accounts and debit cards are poised to strengthen Shopify’s market capture.
  • Partnership with Facebook in launching Facebook Shops in position to capitalize on growing online retail trends and Facebook’s resilient growth despite recent revenue issues.
  • Partnership with CoinPayments in bringing crypto payment platform to Shopify merchants set to make crypto payment options easier and more affordable.

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AI Anticipates Which Sectors Will Perform Best During Coronavirus Pandemic

This article was written by Gabriel Plat, a Financial Analyst at I Know First.

Summary:

  • COVID-19 is still affecting the economy. The transport has seen losses of over 77% since the start of the pandemic;
  • Movie producers and operators are suffering from quarantine impositions. Stocks of Universal Studios, Disney and AMC all dropped over 20% in the last six months;
  • E-commerce appeared as a huge opportunity to profit during these times. Shopify stock rose 254% this semester, indicating how well the sector is right now;
  • I Know First algorithm predicted one year ago the bullish trend of Shopify, giving investors to enjoy this trend much earlier than expected.

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Shopify Stock Prediction: In A Gold Rush Sell Shovels

This article was written by I Know First Research Team.

Summary:

  • Berkshire Hawthaway just bought Amazon. Shopify’s market cap is approximately 3% of Amazon’s.
  • Amazon shut down its attempted Shopify competitor Webstore and instead integrated Shopify because Shopify is the leader is the lading multi-channel commerce platform.
  • As the leader in its field, Shopify is in prime position to benefit greatly from the once in-a -lifetime and accelerating transfer of value away from bricks and mortar shopping to the conveniences of online commerce.
  • Shopify is the fastest-growing software-as-a-service company in history to achieve $1B in revenue, growing revenue 59% over 2017.
  • Shopify’s global expansion has a long runway of growth ahead.
  • Geopolitical macro trade developments are providing an attractive pull back buying opportunity.
  • I Know First Algorithm is currently bullish on Shopify.

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