Shopify (NASDAQ:SHOP) Shares Down 6.1% - Here's Why

Key Points

• Shopify shares fell 6.1% to $136.29, with trading volume down 86% from the average session. The article does not identify a specific news catalyst for the decline.
• Analyst sentiment remains broadly positive, with a consensus “Moderate Buy” rating and an average price target of $171.65, despite some recent rating downgrades.
• Shopify reported quarterly revenue growth of 33.7% year over year and earnings of $0.42 per share, slightly above estimates, but the stock trades at a high price-to-earnings ratio of 90.64.

Shares of Shopify Inc. (NASDAQ:SHOP - Get Free Report) TSE: SHOP fell 6.1% during trading on Tuesday . The company traded as low as $135.52 and last traded at $136.29. Approximately 1,433,794 shares traded hands during trading, a decline of 86% from the average session volume of 10,347,278 shares. The stock had previously closed at $145.09.

Wall Street Analyst Weigh In

SHOP has been the topic of a number of research reports. Royal Bank Of Canada set a $180.00 price target on shares of Shopify and gave the company an "outperform" rating in a research note on Wednesday, August 26th. BTIG Research started coverage on Shopify in a research note on Friday, July 10th. They set a "buy" rating for the company. Morgan Stanley cut Shopify from an "overweight" rating to a "buy" rating in a report on Monday, July 13th. Wells Fargo & Company restated an "overweight" rating and issued a $180.00 target price (up from $144.00) on shares of Shopify in a research report on Friday, August 7th. Finally, DZ Bank lowered Shopify from a "strong-buy" rating to a "hold" rating in a research note on Friday, August 7th. One equities research analyst has rated the stock with a Strong Buy rating, thirty-five have given a Buy rating and ten have issued a Hold rating to the company. According to data from MarketBeat, Shopify currently has a consensus rating of "Moderate Buy" and an average target price of $171.65.

Shopify Trading Down 7.5%

The company has a current ratio of 5.35, a quick ratio of 5.35 and a debt-to-equity ratio of 0.01. The company has a fifty day moving average price of $134.82 and a two-hundred day moving average price of $122.99. The firm has a market capitalization of $172.59 billion, a price-to-earnings ratio of 90.64, a PEG ratio of 2.96 and a beta of 2.61.

Shopify (NASDAQ:SHOP - Get Free Report) TSE: SHOP last posted its quarterly earnings results on Wednesday, August 5th. The software maker reported $0.42 EPS for the quarter, beating the consensus estimate of $0.40 by $0.02. Shopify had a return on equity of 12.58% and a net margin of 14.53%.The firm had revenue of $3.58 billion during the quarter. During the same period in the prior year, the business posted $0.69 EPS. Shopify's revenue for the quarter was up 33.7% compared to the same quarter last year. As a group, research analysts forecast that Shopify Inc. will post 1.45 earnings per share for the current fiscal year.

Institutional Trading of Shopify

Hedge funds and other institutional investors have recently modified their holdings of the stock. Smartleaf Asset Management LLC grew its holdings in shares of Shopify by 13.9% in the second quarter. Smartleaf Asset Management LLC now owns 631 shares of the software maker's stock valued at $72,000 after purchasing an additional 77 shares during the period. Tsfg LLC raised its stake in Shopify by 4.0% during the second quarter. Tsfg LLC now owns 2,028 shares of the software maker's stock worth $232,000 after purchasing an additional 78 shares during the period. Parr Mcknight Wealth Management Group LLC boosted its holdings in Shopify by 3.1% in the 1st quarter. Parr Mcknight Wealth Management Group LLC now owns 2,762 shares of the software maker's stock valued at $328,000 after purchasing an additional 84 shares during the last quarter. Founders Financial Alliance LLC boosted its holdings in Shopify by 5.2% in the 4th quarter. Founders Financial Alliance LLC now owns 1,768 shares of the software maker's stock valued at $285,000 after purchasing an additional 87 shares during the last quarter. Finally, Caerus Investment Advisors LLC grew its stake in shares of Shopify by 5.6% in the 1st quarter. Caerus Investment Advisors LLC now owns 1,688 shares of the software maker's stock valued at $200,000 after buying an additional 90 shares during the period. 69.27% of the stock is owned by institutional investors and hedge funds.

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.