Shop Stock Seen Up 31.1% Ahead of Shopify Q1 Results
Shop stock is in focus as Shopify heads into Tuesday morning results, with revenue expected to rise 31.1% year on year. That would extend the company’s recent pace after 30.6% growth on $3.67 billion of revenue last quarter, and it gives holders a clear checkpoint on whether the business is still clearing a high bar.
31.1% is the figure analysts are now working with for Q1, a step up from the 26.8% increase in the same quarter last year. For shareholders, that sets up a simple test: whether Shopify can keep growing faster than it did a year ago while also building on a quarter in which it beat EBITDA (earnings before interest, taxes, depreciation, amortization) and gross merchandise volume estimates.
Shopify and the $3.67 billion base
$3.67 billion was Shopify’s last reported quarterly revenue, and the 30.6% year-on-year gain showed the company was still expanding at a brisk clip. That prior result matters because Tuesday’s release will show whether the company can carry that pace forward or whether the year-over-year comparison starts to narrow after a strong base.
30 days is the window in which the majority of analysts covering Shopify have reconfirmed their estimates. That steady posture leaves the forecast intact heading into the print, which means the stock is being judged less on whether expectations moved and more on whether Shopify can exceed them again.
GoDaddy at 6.1%, Zeta at 49.9%
6.1% was GoDaddy’s year-on-year revenue growth in its latest results, and it met analysts’ expectations. Zeta Global reported 49.9% revenue growth and topped estimates by 7%, but its stock was unchanged after the report, while GoDaddy traded up 3%.
8.7% was the average move in sales and marketing software shares over the last month, and Shopify rose 7.2% over the same period. The gap leaves Shopify trading with some recent strength already priced in, even before the company reports whether its own growth rate can stay ahead of peers.
Shopify at $159.49 target
$159.49 is the average analyst price target on Shopify, versus a current share price of $127.41. That spread leaves room for upside if Tuesday morning’s numbers extend the company’s history of beating Wall Street expectations, but the report will also reset the debate around how much of that growth is already reflected in the shares.
Tuesday morning is the only date that matters now, because the report will answer whether Shopify can keep revenue growth above 30% and hold the market’s attention with another beat on the metrics analysts have been using to measure it.
