Citigroup Has Lowered Expectations for Shopify (NASDAQ:SHOP) Stock Price

Key Points

• Citigroup cut its price target on Shopify from $163 to $156, which still implies about 48.54% upside from the stock's previous close.
• Shopify beat Q1 estimates with revenue of $3.17 billion (up ~34%) and GMV topping $100 billion, but softer guidance and margin concerns drove shares down roughly 2.4% to $105.02.
• The Street consensus is a Moderate Buy with an average price target near $158.97, though analyst opinions and targets vary and the stock trades at a high multiple (P/E ~112.9) with a market cap around $137B.

Shopify (NASDAQ:SHOP - Get Free Report) TSE: SHOP had its price target cut by equities researchers at Citigroup from $163.00 to $156.00 in a research report issued to clients and investors on Wednesday,BayStreet.CA reports. Citigroup's price objective would indicate a potential upside of 48.54% from the company's previous close.

SHOP has been the subject of a number of other research reports. UBS Group set a $130.00 price objective on shares of Shopify in a research note on Wednesday. Mizuho raised shares of Shopify from a "neutral" rating to an "outperform" rating and set a $150.00 price objective for the company in a research note on Thursday, February 12th. Needham & Company LLC reissued a "buy" rating and set a $180.00 price target on shares of Shopify in a research report on Tuesday. Arete Research set a $175.00 price target on shares of Shopify in a research report on Monday, February 2nd. Finally, Oppenheimer reissued an "outperform" rating and set a $175.00 price target on shares of Shopify in a research report on Wednesday. Two equities research analysts have rated the stock with a Strong Buy rating, thirty-two have given a Buy rating and ten have given a Hold rating to the company. According to MarketBeat, Shopify currently has a consensus rating of "Moderate Buy" and a consensus price target of $158.97.

Shopify Stock Down 2.4%

Shares of Shopify stock traded down $2.61 during trading on Wednesday, reaching $105.02. The company's stock had a trading volume of 17,174,609 shares, compared to its average volume of 10,980,982. Shopify has a 52-week low of $88.14 and a 52-week high of $182.19. The company has a market cap of $136.96 billion, a price-to-earnings ratio of 112.92, a PEG ratio of 4.53 and a beta of 2.64. The firm's 50-day moving average is $122.10 and its two-hundred day moving average is $141.64.

Shopify (NASDAQ:SHOP - Get Free Report) TSE: SHOP last announced its quarterly earnings data on Tuesday, May 5th. The software maker reported $999.00 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.22 by $998.78. Shopify had a net margin of 10.65% and a return on equity of 11.52%. The company had revenue of $3.17 billion during the quarter, compared to analysts' expectations of $3.08 billion. On average, equities research analysts anticipate that Shopify will post 1.36 EPS for the current year.

Institutional Investors Weigh In On Shopify

Several institutional investors and hedge funds have recently modified their holdings of SHOP. Brighton Jones LLC grew its holdings in Shopify by 2.8% in the fourth quarter. Brighton Jones LLC now owns 21,176 shares of the software maker's stock worth $2,252,000 after purchasing an additional 584 shares during the period. AQR Capital Management LLC grew its holdings in Shopify by 107.3% in the first quarter. AQR Capital Management LLC now owns 14,576 shares of the software maker's stock worth $1,392,000 after purchasing an additional 7,544 shares during the period. Sivia Capital Partners LLC grew its holdings in Shopify by 6.6% in the second quarter. Sivia Capital Partners LLC now owns 8,190 shares of the software maker's stock worth $945,000 after purchasing an additional 506 shares during the period. Osterweis Capital Management Inc. purchased a new stake in Shopify in the second quarter worth about $53,000. Finally, Main Street Financial Solutions LLC grew its holdings in Shopify by 15.3% in the second quarter. Main Street Financial Solutions LLC now owns 11,131 shares of the software maker's stock worth $1,284,000 after purchasing an additional 1,479 shares during the period. 69.27% of the stock is owned by hedge funds and other institutional investors.

Key Shopify News

Here are the key news stories impacting Shopify this week:

• Positive Sentiment: Q1 results beat on revenue and showed strong platform traction — revenue rose ~34% to $3.17B and GMV topped $100B, evidence demand and AI-driven orders remain material growth drivers. Read More.
• Positive Sentiment: Several influential analysts reaffirmed bullish ratings and high price targets (RBC with $170, Needham with $180), signaling continued long-term upside in Street expectations despite the pullback. Read More.
• Positive Sentiment: Unusual options activity: large call buying (≈213k calls, ~332% above normal) suggests some traders are betting on a rebound or event-driven upside in the near term. (No direct article link available)
• Neutral Sentiment: Q2 revenue guidance given as a range (~$3.4B–$3.5B) that roughly tracks consensus; revenue guidance was not clearly above expectations, which leaves room for re‑rating depending on execution and margin detail. Read More.
• Neutral Sentiment: Shopify highlighted AI-driven commerce gains (orders up materially via integrations with ChatGPT/Copilot/Google), which supports medium-term TAM expansion but the near-term margin path remains uncertain. Read More.
• Negative Sentiment: Several firms cut price targets (DA Davidson to $140, Wells Fargo to $144, Citizens Jmp to $150). Those cuts tighten near-term analyst momentum and can pressure the stock until guidance/margins prove resilient. Read More.
• Negative Sentiment: Market reaction: despite the beat, investors focused on a softer outlook and operating-profit concerns — shares fell after the print as traders relegated the beat in favor of slower expected growth and margin pressure. Read More.
• Negative Sentiment: Coverage noting a sizeable Q1 loss and cautious guidance amplified the negative sentiment and selling pressure. Near-term stock performance will hinge on Shopify’s ability to translate AI momentum into margin-accretive revenue. Read More.

Shopify Company Profile

Shopify is a Canadian commerce technology company that provides a cloud-based platform for businesses to create, manage and scale online and physical retail stores. Its core offering is a software-as-a-service e-commerce platform that enables merchants to build customizable storefronts, manage product catalogs, process orders, and handle inventory. Shopify also supports omnichannel selling through integrated point-of-sale (POS) systems for in-person transactions.

Beyond storefront software, Shopify offers a range of merchant services and tools designed to simplify commerce operations.

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