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Summary
- The rallying stocks of Shopify hit an all-time high of C$ 1,900 on Tuesday, with a 33 per cent surge month-to-date (MTD).
- It has a tempting one-year return of 181 per cent, with a price-to-cashflow ratio of 747.
- The eCommerce firm expects to announce its fourth quarter results on Wednesday, February 17. A healthy topline is expected in Q4, as Shopify had an extraordinary sales spree in late 2020.
While brick-and-mortar retail stores struggled amid the global coronavirus outbreak, eCommerce emerged as an invigorating platform.
The blend of eCommerce and social media has been ruling the retail industry, with their evolving marketing capabilities.
Canadian biggest company by market cap belongs from the ecommerce segment.
Shopify Inc. (TSX:SHOP) has been roaring in the stock markets as demand for its platform hit the roof with an influx of new merchants.
What is so enticing about this stock?
Shopify Inc. (TSX: SHOP)
The giant eCommerce platform’s growth has been creating a buzz throughout lockdowns.
Now, the stock is at an all-time high of C$ 1,900 and is on course to achieve the C$ 2,000-milestone. Going by the recent stock momentum, this could be attained this month or by mid-March.
The stock traded in green and closed at C$ 1858 per share on February 11.
The company has several partnerships across the globe, including a collaboration with the Government of Canada.
Shopify has played a crucial role in guiding Canadian businesses’ digital transformation through its software-based platforms. It also offers Shopify payments option via Buy on Google and operates a studio for commercial advertising.
In short, Shopify is the ruling champ of the e-commerce game.
The large-cap software firm has a market cap of C$ 206 billion. It has returned over 181 per cent growth in one year, with a price-to-sales ratio of 70.04.
In 2021, it catapulted by over 29 per cent, with earnings per share of C$ 2.20.
The stock is up 33 per cent month-to-date (MTD), with a price-to-cashflow ratio of 747.
Image Source: Kalkine Group @2020
A Strong Topline & Higher Sales Volume
Its revenues soared to US$ 767.4 million in the third quarter of 2020, with a massive surge of 96 per cent year-over-year (YoY). The increase was because of the higher growth in e-commerce solutions. Its gross profit was US$ 405.1 million in Q3 2020, up 87 per cent YoY.
The operating income amounted to US$ 50.6 million. Its net income was US$ 191.1 million in the third quarter, up against a net loss of US$ 72.8 million in Q3 2019.
Shopify’s fourth quarter results are due on Wednesday, February 17.
On December 1, 2020, it reported Black Friday weekend sales of over US$ 5.1 billion from its brands across the globe, a jump of 79 per cent YoY. Due to the higher sales growth, investors could expect a robust Q4 revenue announcement next week.
