Bullish Shopify Analyst Says E-Commerce Platform In Early Stages Of Growth

Shopify Inc SHOP has the ability to capture share in e-commerce in the near term and is poised to benefit from the acceleration in e-commerce trends over time, according to Wedbush.

The Shopify Analyst: Ygal Arounian upgraded Shopify from Neutral to Outperform and raised the price target from $998 to $1,300.

The Shopify Takeaways: The shift to e-commerce appears sustainable, as it is largely driven by ongoing changes to consumer habits, Arounian said in the Wednesday upgrade note.

“We continue to like the short-term trends and Shopify’s position to capture them,” the analyst said.

The upgrade reflects longer-term prospects that are “driven by Shopify’s position to capture share of the total retail TAM as it builds out its retail OS,” he said. 

“SFN (Shopify Fulfillment Network) and POS (Shopify Point of Sale) are key initiatives that get Shopify towards its vision of a retail OS, rather than an e-commerce platform,” Arounian said.

Shopify is in the early stages of “significant merchant, GMV, and revenue growth stemming from the shift into a well-built retail OS,” the analyst said. 

SHOP Price Action: Shares of Shopify were trading slightly positive at $1,026 at the time of publication Wednesday. 

Photo courtesy of Shopify.