In the latest close session, Shopify (SHOP) was down 7.26% at $144.50. This change lagged the S&P 500's daily loss of 2.06%. Meanwhile, the Dow experienced a drop of 1.76%, and the technology-dominated Nasdaq saw a decrease of 2.39%.
Shares of the cloud-based commerce company witnessed a loss of 8.17% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 1.71%, and the S&P 500's gain of 1.63%.
The investment community will be closely monitoring the performance of Shopify in its forthcoming earnings report. On that day, Shopify is projected to report earnings of $0.5 per share, which would represent year-over-year growth of 13.64%. In the meantime, our current consensus estimate forecasts the revenue to be $3.58 billion, indicating a 27.33% growth compared to the corresponding quarter of the prior year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.45 per share and revenue of $11.46 billion, indicating changes of +11.54% and 0%, respectively, compared to the previous year.
Investors should also take note of any recent adjustments to analyst estimates for Shopify. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.53% higher within the past month. Shopify is currently a Zacks Rank #3 (Hold).
In the context of valuation, Shopify is at present trading with a Forward P/E ratio of 87.94. This represents a premium compared to its industry average Forward P/E of 17.85.
Meanwhile, SHOP's PEG ratio is currently 3.56. 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. By the end of yesterday's trading, the Internet - Services industry had an average PEG ratio of 1.76.
The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 67, which puts it in the top 28% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained 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 ReportThis article originally published on Zacks Investment Research (zacks.com).
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