In the latest trading session, Shopify (SHOP) closed at $169.57, marking a +1.66% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.88%. Elsewhere, the Dow saw an upswing of 0.38%, while the tech-heavy Nasdaq appreciated by 1.31%.
Heading into today, shares of the cloud-based commerce company had gained 15.39% over the past month, outpacing the Computer and Technology sector's gain of 1.49% and the S&P 500's gain of 2.48%.
The upcoming earnings release of Shopify will be of great interest to investors. The company's earnings per share (EPS) are projected to be $0.5, reflecting a 13.64% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $3.58 billion, indicating a 27.13% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $1.45 per share and revenue of $11.45 billion, which would represent changes of +11.54% and +28.96%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Shopify. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational 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 has shifted 0.59% downward. Shopify presently features a Zacks Rank of #3 (Hold).
Digging into valuation, Shopify currently has a Forward P/E ratio of 115.18. This denotes a premium relative to the industry average Forward P/E of 19.77.
It's also important to note that SHOP currently trades at a PEG ratio of 4.66. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Services was holding an average PEG ratio of 1.75 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 86, putting it in the top 35% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Shopify Inc. (SHOP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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