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Canada’s largest ecommerce platform Shopify Inc. (TSX, NYSE: SHOP) aims to raise US$1.55 billion via a public stock offering of 1.18 million Class A shares priced at US$1,315 apiece.
The tech giant aims to use the funds for growth strategies and to strengthen its balance sheet.
Shopify’s TSX-listed shares are up 21 per cent year-to-date. The stocks have returned over 4,800 per cent in the last 5 years 2 months. In other words, an investment of C$10,000 in Shopify in December 2015 has returned over C$ 492,000 by February 2021.
Shopify StockWatch
Shopify cruised during the pandemic and overcame the tech rout in the second half of 2020 to return over 153 per cent in the last one-year.
The TSX-listed stocks closed at C$1,742.26 on Monday, down 10 per cent from its 52-week high of C$1900.58 on February 10, 2021. But they have growth by an astonishing 300+ per cent from its 52-week low of C$ 435 on March 17, 2020.
Shopify stocks fell in four out of the last six trading sessions. The were down ~6 per cent on TSX at 11:23 am ET on Tuesday.
However, the ecommerce enabling platform had an incredible last week due to its earnings.
@Kalkine Image 2021
Shopify Financials
Shopify’s incredible fourth quarter numbers and 2020 earnings have investors jumping in joy.
It reported US$2.9 billion in revenue last year, up 86 per cent year-over-year (YoY). The Q4 revenue increased by 94 per cent YoY to US$ 977.7 million.
Adjusted gross profit grew 89 per cent to US$510.6 million in Q4 2020, as compared to US$269.9 million a year ago.
Shopify’s monthly recurring revenue (MRR) has never decreased since Q4 2015. It has a fast-growing partner ecosystem. Increase in the revenue of merchants on its platform means expanding revenue for Shopify.
The company has mentioned in its investors report that the global addressable market in the small- and medium-business is about US$153 billion. So, there’s a lot of market ground to cover.
But the company is ringing the warning bells, informing investors to expect revenue deceleration in future. The pandemic contributed to Shopify’s massive growth. But this growth will likely slow down after the economy re-opens.
The company has reported three consecutive profitable quarters and there’s probably more steam left in the stock.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.
