SHOPIFY INC - CLASS A (SHOP.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:SHOP - CA82509L1076 - Common Stock
233 CAD
+3.94 (+1.72%)
Overall SHOP gets a fundamental rating of 7 out of 10. We evaluated SHOP against 12 industry peers in the IT Services industry. Both the health and profitability get an excellent rating, making SHOP a very profitable company, without any liquidiy or solvency issues. SHOP is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make SHOP a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
SHOP had positive earnings in the past year.
In the past year SHOP had a positive cash flow from operations.
Of the past 5 years SHOP 4 years were profitable.
Of the past 5 years SHOP 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of SHOP (11.84%) is better than 91.67% of its industry peers.
SHOP's Return On Equity of 14.24% is amongst the best of the industry. SHOP outperforms 91.67% of its industry peers.
SHOP has a better Return On Invested Capital (8.30%) than 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.84% | ||
| ROE | 14.24% | ||
| ROIC | 8.3% |
ROA(3y)-5.5%
ROA(5y)1.89%
ROE(3y)-7.69%
ROE(5y)1.62%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
SHOP has a Profit Margin of 16.65%. This is amongst the best in the industry. SHOP outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of SHOP has declined.
SHOP has a better Operating Margin (12.29%) than 91.67% of its industry peers.
In the last couple of years the Operating Margin of SHOP has grown nicely.
With an excellent Gross Margin value of 48.75%, SHOP belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
In the last couple of years the Gross Margin of SHOP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.29% | ||
| PM (TTM) | 16.65% | ||
| GM | 48.75% |
OM growth 3Y23.17%
OM growth 5YN/A
PM growth 3Y-28.88%
PM growth 5YN/A
GM growth 3Y-2.18%
GM growth 5Y-1.69%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SHOP is creating some value.
SHOP has more shares outstanding than it did 1 year ago.
SHOP has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, SHOP has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 54.30 indicates that SHOP is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 54.30, SHOP belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
SHOP has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.48 | ||
| Altman-Z | 54.3 |
ROIC/WACC1.02
WACC8.14%
2.3 Liquidity
SHOP has a Current Ratio of 3.93. This indicates that SHOP is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 3.93, SHOP belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
A Quick Ratio of 3.93 indicates that SHOP has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 3.93, SHOP belongs to the top of the industry, outperforming 91.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.93 | ||
| Quick Ratio | 3.93 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 15.65% over the past year.
Measured over the past years, SHOP shows a very strong growth in Earnings Per Share. The EPS has been growing by 70.21% on average per year.
Looking at the last year, SHOP shows a very strong growth in Revenue. The Revenue has grown by 30.25%.
SHOP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 41.27% yearly.
EPS 1Y (TTM)15.65%
EPS 3Y23.18%
EPS 5Y70.21%
EPS Q2Q%-2.86%
Revenue 1Y (TTM)30.25%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.54%
3.2 Future
SHOP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.54% yearly.
SHOP is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 23.59% yearly.
EPS Next Y23.16%
EPS Next 2Y24.82%
EPS Next 3Y25.68%
EPS Next 5Y21.54%
Revenue Next Year30.42%
Revenue Next 2Y27.02%
Revenue Next 3Y25.19%
Revenue Next 5Y23.59%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
SHOP is valuated quite expensively with a Price/Earnings ratio of 128.02.
Based on the Price/Earnings ratio, SHOP is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
SHOP's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.17.
With a Price/Forward Earnings ratio of 91.02, SHOP can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SHOP indicates a somewhat cheap valuation: SHOP is cheaper than 75.00% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of SHOP to the average of the S&P500 Index (23.79), we can say SHOP is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 128.02 | ||
| Fwd PE | 91.02 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SHOP is on the same level as its industry peers.
66.67% of the companies in the same industry are more expensive than SHOP, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 116.42 | ||
| EV/EBITDA | 157.52 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
SHOP has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as SHOP's earnings are expected to grow with 25.68% in the coming years.
PEG (NY)5.53
PEG (5Y)1.82
EPS Next 2Y24.82%
EPS Next 3Y25.68%
5. Dividend
5.1 Amount
SHOP does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
TSX:SHOP (1/6/2026, 7:00:00 PM)
233
+3.94 (+1.72%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners74.8%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap303.33B
Revenue(TTM)10.70B
Net Income(TTM)1.78B
Analysts76.36
Price Target245.19 (5.23%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)9.14%
Min EPS beat(2)-0.68%
Max EPS beat(2)18.96%
EPS beat(4)1
Avg EPS beat(4)0.31%
Min EPS beat(4)-11.32%
Max EPS beat(4)18.96%
EPS beat(8)5
Avg EPS beat(8)9.45%
EPS beat(12)9
Avg EPS beat(12)90.51%
EPS beat(16)11
Avg EPS beat(16)52.5%
Revenue beat(2)2
Avg Revenue beat(2)2.15%
Min Revenue beat(2)1.17%
Max Revenue beat(2)3.12%
Revenue beat(4)3
Avg Revenue beat(4)1.14%
Min Revenue beat(4)-0.72%
Max Revenue beat(4)3.12%
Revenue beat(8)5
Avg Revenue beat(8)0.56%
Revenue beat(12)9
Avg Revenue beat(12)1.14%
Revenue beat(16)11
Avg Revenue beat(16)0.33%
PT rev (1m)-0.22%
PT rev (3m)8.35%
EPS NQ rev (1m)0.51%
EPS NQ rev (3m)2.97%
EPS NY rev (1m)0.13%
EPS NY rev (3m)1.57%
Revenue NQ rev (1m)0.03%
Revenue NQ rev (3m)3.57%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 128.02 | ||
| Fwd PE | 91.02 | ||
| P/S | 20.71 | ||
| P/FCF | 116.42 | ||
| P/OCF | 115.2 | ||
| P/B | 17.71 | ||
| P/tB | 18.48 | ||
| EV/EBITDA | 157.52 |
EPS(TTM)1.82
EY0.78%
EPS(NY)2.56
Fwd EY1.1%
FCF(TTM)2
FCFY0.86%
OCF(TTM)2.02
OCFY0.87%
SpS11.25
BVpS13.16
TBVpS12.61
PEG (NY)5.53
PEG (5Y)1.82
Graham Number23.21
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.84% | ||
| ROE | 14.24% | ||
| ROCE | 10.25% | ||
| ROIC | 8.3% | ||
| ROICexc | 16.44% | ||
| ROICexgc | 17.89% | ||
| OM | 12.29% | ||
| PM (TTM) | 16.65% | ||
| GM | 48.75% | ||
| FCFM | 17.79% |
ROA(3y)-5.5%
ROA(5y)1.89%
ROE(3y)-7.69%
ROE(5y)1.62%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y37.8%
ROICexgc growth 5YN/A
ROICexc growth 3Y39.24%
ROICexc growth 5YN/A
OM growth 3Y23.17%
OM growth 5YN/A
PM growth 3Y-28.88%
PM growth 5YN/A
GM growth 3Y-2.18%
GM growth 5Y-1.69%
F-Score6
Asset Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.48 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 62.5% | ||
| Cap/Sales | 0.19% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 142.76% | ||
| Profit Quality | 106.85% | ||
| Current Ratio | 3.93 | ||
| Quick Ratio | 3.93 | ||
| Altman-Z | 54.3 |
F-Score6
WACC8.14%
ROIC/WACC1.02
Cap/Depr(3y)54.58%
Cap/Depr(5y)60.06%
Cap/Sales(3y)0.55%
Cap/Sales(5y)0.84%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)15.65%
EPS 3Y23.18%
EPS 5Y70.21%
EPS Q2Q%-2.86%
EPS Next Y23.16%
EPS Next 2Y24.82%
EPS Next 3Y25.68%
EPS Next 5Y21.54%
Revenue 1Y (TTM)30.25%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.54%
Revenue Next Year30.42%
Revenue Next 2Y27.02%
Revenue Next 3Y25.19%
Revenue Next 5Y23.59%
EBIT growth 1Y46.27%
EBIT growth 3Y53.23%
EBIT growth 5YN/A
EBIT Next Year35.38%
EBIT Next 3Y33.67%
EBIT Next 5Y38.08%
FCF growth 1Y169.26%
FCF growth 3Y48.78%
FCF growth 5Y186.89%
OCF growth 1Y155.93%
OCF growth 3Y44.49%
OCF growth 5Y87.03%
SHOPIFY INC - CLASS A / SHOP.CA FAQ
What is the ChartMill fundamental rating of SHOPIFY INC - CLASS A (SHOP.CA) stock?
ChartMill assigns a fundamental rating of 7 / 10 to SHOP.CA.
What is the valuation status for SHOP stock?
ChartMill assigns a valuation rating of 4 / 10 to SHOPIFY INC - CLASS A (SHOP.CA). This can be considered as Fairly Valued.
What is the profitability of SHOP stock?
SHOPIFY INC - CLASS A (SHOP.CA) has a profitability rating of 7 / 10.
How financially healthy is SHOPIFY INC - CLASS A?
The financial health rating of SHOPIFY INC - CLASS A (SHOP.CA) is 9 / 10.