20-Year Pro Trader Reveals His "MoneyLine"
Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.
Even though Shopify Inc (NYSE:SHOP) continues to be among the top picks in the ecommerce sector, the company’s GMV (Gross Merchandise Value) growth is now more skewed towards enterprise, which exerts pressure on gross profit margins, according to JMP Securities.
The Shopify Analyst: Andrew Boone downgraded the rating for Shopify from Market Outperform to Market Perform.
The Shopify Thesis: Although the company is gaining share with enterprise and offline merchants, it faces gross margin headwinds, given the “lower payment take rates and non-payment Merchant Solution attach rates,” Boone said in the downgrade note.
Check out other analyst stock ratings.
The analyst expresses doubts about Shopify's ability to fulfill the projected growth in subscription revenue. This skepticism is rooted in the expectation for 2025, which, as the analyst notes, "calls for acceleration in subscription revenue in 2025, which we believe implies a price increase for Plus merchants."
“While we believe Shopify could push through a price increase, in our view, it is focused on growing enterprise accounts, and we believe a price increase is further out than the Street is currently modeling,” he added.
The stock is currently trading at a “significant free cash flow multiple premium” versus other category-leading software companies, such as Workday Inc (NASDAQ:WDAY) and ServiceNow Inc (NYSE:NOW), Boone further stated.
SHOP Price Action: Shares of Shopify were up 0.1% to $76.96 at the time of publication on Monday.
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Photo: Shutterstock
20-Year Pro Trader Reveals His "MoneyLine"
Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.
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