Abhoy Sarkar's Avatar
Abhoy Sarkar
published in Blogs
Jun 18, 2020
Shopify (SHOP, $860.52) gets price target lift from RBC

Shopify (SHOP, $860.52) gets price target lift from RBC

Shopify  shares got a price target hike from analysts at RBC Capital.

On Thursday,  RBC Capital  analysts boosted their price target on the e-commerce company to $1,000 per share from $825 per share. They reaffirmed their outperform rating.  

According to the analysts, the market "still underappreciates" some aspects about Shopify. RBC expects Shopify’s annual revenue to climb to $25 billion by 2028, from an estimated $2.3 billion in 2020.

The analysts mentioned that Shopify has garnered more than 1 million merchants on its platform, which is more than triple from 325,000 merchants in 2016.

RBC also projects that Shopify's take rate, or the percentage of transactions on its platform that the company keeps, will expand by 30 to 40 basis points in the near term on growth in payment adoption. For the  long-term, the analysts  anticipate expansion in its take rate of between 100 and 110 basis points fueled by increased usage of value-added services (VAS) like Shopify Capital, shipping and the Shopify Fulfillment Network. 

SHOP's in Uptrend: Moving Average Convergence Divergence (MACD) Histogram just turned positive

This is a Bullish indicator signaling SHOP's price could rise. Traders may explore going long on the ticker or buying call options. In 46 of 50 cases where SHOP's MACD histogram became positive, the price rose further within the following month. The odds of a continued Uptrend are 90%.

Current price $860.52 is above $767.00 the highest resistance line found by A.I. Throughout the month of 05/15/20 - 06/17/20, the price experienced a +7% Uptrend. During the week of 06/10/20 - 06/17/20, the stock enjoyed a +10% Uptrend growth.

Technical Analysis (Indicators)

Bullish Trend Analysis

The Momentum Indicator exceeded the 0 level on June 15, 2020. Traders may consider buying the ticker or exploring call options. In 58 of 65 cases where the ticker's Momentum Indicator exceeded 0, its price rose further within the subsequent month. The odds of a continued Uptrend are 89%.

Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SHOP advanced for three days, in 322 of 372 cases, the price rose further within the following month. The odds of a continued Uptrend are 87%.

The Aroon Indicator entered an Uptrend today. In 360 of 416 similar cases where SHOP Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 87%.

Bearish Trend Analysis

The RSI Indicator appears to be shifting from an Uptrend to a Downtrend. In 44 of 64 cases where SHOP's RSI indicator exited the overbought zone, the price fell further within the following month. The odds of a continued Downtrend are 69%.

The Stochastic Indicator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.

The higher Bollinger Band was broken -- a price fall is expected as the ticker heads toward the middle band, which invites the trader to consider selling or shorting the ticker, or exploring put options. In 41 of 64 cases where SHOP's price broke its higher Bollinger Band, its price dropped further during the following month. The odds of a continued Downtrend are 64%.

Fundamental Analysis (Ratings)

Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 88%. During the last month, the daily ratio of advancing to declining volumes was 1.55 to 1.

The Tickeron Profit vs. Risk Rating rating for this company is 2 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 66, placing this stock better than average.

The Tickeron Price Growth Rating for this company is 35 (best 1 - 100 worst), indicating steady price growth. SHOP’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron SMR rating for this company is 79 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.

The Tickeron Valuation Rating of 97 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: SHOP's P/B Ratio (31.51) is slightly higher than the industry average of (4.28). P/E Ratio (0.00) is within average values for comparable stocks, (38.47). Projected Growth (PEG Ratio) (0.00) is also within normal values, averaging (1.84). Dividend Yield (0.00) settles around the average of (0.10) among similar stocks. SHOP's P/S Ratio (28.19) is very high in comparison to the industry average of (2.63).

The Tickeron PE Growth Rating for this company is 100 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

 

Related Tickers: SHOP
Related Portfolios: E-COMMERCE SECTOR
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