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On Monday, KeyBanc Capital Markets reiterated its Overweight rating on Shopify (NYSE:SHOP) with a price target of $130.00, highlighting the company’s potential for significant international revenue growth. Currently trading at $121.43, Shopify has demonstrated strong momentum with a 69% surge over the past six months. According to InvestingPro data, the company maintains robust financials with $8.21 billion in revenue and an impressive 23.47% growth rate. According to KeyBanc analyst Justin Patterson, the COVID-19 pandemic has accelerated eCommerce adoption by 5-10 years, with global eCommerce penetration of retail sales reaching approximately 18% in 2020, surpassing initial industry expectations of 15.5%.
Patterson notes that the eCommerce software sector, where Shopify operates, could see more than a two-percentage-point expansion in the next two years, a marked change from the stagnant penetration observed over the past four years. KeyBanc anticipates Shopify’s international revenue could exceed $4 billion by 2026, driven by consistent year-over-year growth in the EMEA and APAC regions. The company’s strong financial health is evident in its 50.93% gross profit margin and 12.14% return on assets. For detailed analysis of Shopify’s global expansion potential, InvestingPro subscribers can access comprehensive research reports covering 1,400+ top stocks.
The expansion of Shopify’s international business is expected to account for 32% of its total revenue by 2026. This forecast is supported by the company’s strategic initiatives, including Shopify Markets and Shopify Managed Markets, powered by GLBE. These efforts are aimed at increasing the number of international merchants on the platform and enhancing their global reach.
The analysis by KeyBanc also references industry projections that estimate retail eCommerce spending within the APAC region (excluding China) will grow at an approximate 8% compound annual growth rate (CAGR) through 2027. This figure is slightly behind the predicted 9% growth rate for North America but ahead of the EMEA’s expected 6% CAGR. With a strong current ratio of 7.1 and moderate debt levels, Shopify appears well-positioned to capitalize on these growth opportunities. InvestingPro offers 20 additional investment tips for Shopify, providing deeper insights into the company’s growth trajectory and market position.
In other recent news, Shopify has been the subject of multiple analyst reviews, emphasizing its strong performance and growth potential. RBC Capital Markets maintained its Outperform rating on the company, with a steadfast price target of $130.00, highlighting Shopify’s Gross Merchandise Volume (GMV) and margin strength. Loop Capital Markets also expressed confidence in Shopify, maintaining a Buy rating and a price target of $140.00, noting the positive reception of Shopify’s artificial intelligence tools such as Magic and Sidekick.
Microsoft (NASDAQ:MSFT) and MongoDB (NASDAQ:MDB) were also highlighted by RBC Capital Markets in their ’2025 New Year Preview’ note, with Microsoft emerging as the top large-cap pick and MongoDB as the top non-consensus pick. Shopify was named as one of the best ideas for 2025 due to its growth potential in next-generation commerce platforms and high profitability.
In another report, RBC Capital Markets emphasized the expected outperformance of the S&P/TSX Information Technology (Info-Tech) sub-sector, with Shopify, Constellation Software (ETR:SOWGn), and Kinaxis named as the leading companies poised to drive the sub-sector’s growth. Shopify’s stock was predicted to provide a potential 19% return over the next year.
Lastly, Deutsche Bank (ETR:DBKGn) maintained a positive stance on Shopify, with a Buy rating and a price target of $125.00, following Shopify’s impressive Black Friday Cyber Monday sales figures. The company’s 24% GMV growth rate was notably higher than the mid-to-high single-digit e-commerce growth reported by Salesforce (NYSE:CRM) and Adobe (NASDAQ:ADBE).
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