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On Tuesday, BMO Capital Markets began coverage on Shopify shares, issuing an Outperform rating and setting a price target of $120.00. The firm’s analyst highlighted Shopify’s recent performance, noting improved growth and operating leverage since the company divested its logistics operations in 2023. With a current market capitalization of $127.6 billion and impressive revenue growth of 25.8% in the last twelve months, Shopify has demonstrated strong market momentum. According to InvestingPro analysis, the stock is currently trading near its Fair Value.
Shopify, traded on NASDAQ under the ticker (NASDAQ:SHOP), has been recognized for its potential to continue growing across various fronts. BMO Capital’s analysis suggests that Shopify is well-positioned to leverage its market strength and capitalize on these opportunities. InvestingPro data reveals a robust financial health score of 3.29 (rated as "GREAT"), with a healthy gross profit margin of 50.4% and strong liquidity, as indicated by a current ratio of 3.71.
The analyst pointed to the agility of Shopify’s platform as a key competitive advantage for merchants, especially in the face of potential tariff-related disruptions. According to BMO Capital, such disruptions could actually underscore the value of Shopify’s offerings, potentially leading to increased market share.
Despite the near-term risks posed by tariffs, BMO Capital maintains a positive outlook on Shopify’s core capabilities. The firm believes that the company’s adaptability will continue to be a significant differentiator in the market.
The Outperform rating indicates BMO Capital’s expectation that Shopify’s stock will perform better than the overall market in the near future. The $120 price target reflects the firm’s confidence in Shopify’s growth trajectory and its strategic positioning within the e-commerce industry.
In other recent news, Shopify has seen several significant developments. KeyBanc Capital Markets and RBC Capital Markets have both revised their price targets for Shopify, with KeyBanc lowering it to $105 while maintaining an Overweight rating, and RBC reducing it to $125 but keeping an Outperform rating. These adjustments reflect concerns over potential tariff impacts on Shopify’s growth. Meanwhile, Cantor Fitzgerald also cut its price target to $80, maintaining a Neutral rating, citing expected deceleration in gross merchandise volume growth and revenue projections.
Additionally, Shopify is facing a revived data privacy lawsuit in the U.S. appeals court, which could have implications for its operations in the United States. The court ruled that Shopify’s conduct was aimed at California, allowing the case to proceed. Moreover, Shopify announced details for its 2025 Annual General Meeting, a standard practice for corporate governance, without providing forward-looking statements or financial updates.
These developments highlight the challenges and considerations Shopify faces in the current market environment, including legal, economic, and operational factors. Investors and analysts alike are closely monitoring these situations to assess their potential impact on Shopify’s future performance.
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