In the latest trading session, Shopify ($SHOP) closed at $46.37, marking a -0.19% move from the previous day. This move was narrower than the S&P 500's daily loss of 0.38%. Meanwhile, the Dow lost 0.68%, and the Nasdaq, a tech-heavy index, lost 10.47%.
Heading into today, shares of the cloud-based commerce company had gained 4.85% over the past month, outpacing the Computer and Technology sector's loss of 1.96% and the S&P 500's gain of 2.61% in that time.
Shopify will be looking to display strength as it nears its next earnings release, which is expected to be May 4, 2023. In that report, analysts expect Shopify to post earnings of -$0.04 per share. This would mark a year-over-year decline of 300%. Meanwhile, our latest consensus estimate is calling for revenue of $1.44 billion, up 19.29% from the prior-year quarter.
SHOP's full-year Zacks Consensus Estimates are calling for earnings of $0.06 per share and revenue of $6.66 billion. These results would represent year-over-year changes of +50% and +19%, respectively.Any recent changes to analyst estimates for Shopify should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.02% lower. Shopify is holding a Zacks Rank of #3 (Hold) right now.
Investors should also note Shopify's current valuation metrics, including its Forward P/E ratio of 806.94. For comparison, its industry has an average Forward P/E of 23.21, which means Shopify is trading at a premium to the group.
It can also see that $SHOP currently has a PEG ratio of 60.67. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet – Services industry currently had an average PEG ratio of 1.43 as of yesterday's close.
The Internet – Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 153, which puts it in the bottom 40% of all 250+ industries.
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