SHOPIFY INC - CLASS A (SHOP) Stock Fundamental Analysis
USA - NASDAQ:SHOP - CA82509L1076 - Common Stock
161.14 USD
+9.84 (+6.5%)
160.862 USD
-0.28 (-0.17%)
We assign a fundamental rating of 7 out of 10 to SHOP. SHOP was compared to 86 industry peers in the IT Services industry. SHOP is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. SHOP is valued quite expensive, but it does show an excellent growth. These ratings would make SHOP suitable for growth investing!
1. Profitability
1.1 Basic Checks
In the past year SHOP was profitable.
SHOP had a positive operating cash flow in the past year.
Of the past 5 years SHOP 4 years were profitable.
SHOP had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of SHOP (16.10%) is better than 96.55% of its industry peers.
SHOP has a better Return On Equity (19.34%) than 82.76% of its industry peers.
The Return On Invested Capital of SHOP (8.12%) is better than 68.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.1% | ||
| ROE | 19.34% | ||
| ROIC | 8.12% |
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
With an excellent Profit Margin value of 23.42%, SHOP belongs to the best of the industry, outperforming 96.55% of the companies in the same industry.
SHOP's Profit Margin has declined in the last couple of years.
SHOP has a Operating Margin of 12.50%. This is in the better half of the industry: SHOP outperforms 75.86% of its industry peers.
SHOP's Operating Margin has improved in the last couple of years.
The Gross Margin of SHOP (49.34%) is better than 66.67% of its industry peers.
In the last couple of years the Gross Margin of SHOP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.5% | ||
| PM (TTM) | 23.42% | ||
| GM | 49.34% |
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
SHOP has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it 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.
The debt/assets ratio for SHOP has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 53.20 indicates that SHOP is not in any danger for bankruptcy at the moment.
SHOP has a better Altman-Z score (53.20) than 98.85% of its industry peers.
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 | 0.51 | ||
| Altman-Z | 53.2 |
ROIC/WACC1.01
WACC8.03%
2.3 Liquidity
SHOP has a Current Ratio of 3.85. This indicates that SHOP is financially healthy and has no problem in meeting its short term obligations.
SHOP has a better Current ratio (3.85) than 86.21% of its industry peers.
A Quick Ratio of 3.85 indicates that SHOP has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 3.85, SHOP belongs to the top of the industry, outperforming 86.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.85 | ||
| Quick Ratio | 3.85 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 28.85% over the past year.
The Earnings Per Share has been growing by 70.21% on average over the past years. This is a very strong growth
The Revenue has grown by 28.98% in the past year. This is a very strong growth!
The Revenue has been growing by 41.27% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)28.85%
EPS 3Y23.18%
EPS 5Y70.21%
EPS Q2Q%34.62%
Revenue 1Y (TTM)28.98%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.05%
3.2 Future
Based on estimates for the next years, SHOP will show a very strong growth in Earnings Per Share. The EPS will grow by 21.38% on average per year.
SHOP is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 22.74% yearly.
EPS Next Y21.25%
EPS Next 2Y23.99%
EPS Next 3Y25.39%
EPS Next 5Y21.38%
Revenue Next Year28.03%
Revenue Next 2Y25.14%
Revenue Next 3Y23.74%
Revenue Next 5Y22.74%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 120.25 indicates a quite expensive valuation of SHOP.
The rest of the industry has a similar Price/Earnings ratio as SHOP.
Compared to an average S&P500 Price/Earnings ratio of 27.86, SHOP is valued quite expensively.
The Price/Forward Earnings ratio is 87.34, which means the current valuation is very expensive for SHOP.
SHOP's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 23.32. SHOP is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 120.25 | ||
| Fwd PE | 87.34 |
4.2 Price Multiples
SHOP's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. SHOP is more expensive than 68.97% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as SHOP.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 115.26 | ||
| EV/EBITDA | 155.96 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of SHOP may justify a higher PE ratio.
A more expensive valuation may be justified as SHOP's earnings are expected to grow with 25.39% in the coming years.
PEG (NY)5.66
PEG (5Y)1.71
EPS Next 2Y23.99%
EPS Next 3Y25.39%
5. Dividend
5.1 Amount
No dividends for SHOP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
161.14
+9.84 (+6.5%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners74.51%
Inst Owner Change0%
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap209.43B
Analysts76.07
Price Target162.41 (0.79%)
Short Float %1.71%
Short Ratio2.74
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)6.62%
Min EPS beat(2)-5.73%
Max EPS beat(2)18.96%
EPS beat(4)2
Avg EPS beat(4)7.06%
Min EPS beat(4)-11.32%
Max EPS beat(4)26.33%
EPS beat(8)6
Avg EPS beat(8)18.35%
EPS beat(12)10
Avg EPS beat(12)96.64%
EPS beat(16)11
Avg EPS beat(16)50.51%
Revenue beat(2)1
Avg Revenue beat(2)1.18%
Min Revenue beat(2)-0.72%
Max Revenue beat(2)3.08%
Revenue beat(4)3
Avg Revenue beat(4)0.89%
Min Revenue beat(4)-0.72%
Max Revenue beat(4)3.08%
Revenue beat(8)5
Avg Revenue beat(8)0.47%
Revenue beat(12)9
Avg Revenue beat(12)1.06%
Revenue beat(16)10
Avg Revenue beat(16)0.03%
PT rev (1m)2.05%
PT rev (3m)39.76%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.79%
EPS NY rev (1m)-0.68%
EPS NY rev (3m)1.36%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)4.97%
Revenue NY rev (1m)0.33%
Revenue NY rev (3m)3.47%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 120.25 | ||
| Fwd PE | 87.34 | ||
| P/S | 20.91 | ||
| P/FCF | 115.26 | ||
| P/OCF | 114.25 | ||
| P/B | 17.27 | ||
| P/tB | 18.06 | ||
| EV/EBITDA | 155.96 |
EPS(TTM)1.34
EY0.83%
EPS(NY)1.84
Fwd EY1.14%
FCF(TTM)1.4
FCFY0.87%
OCF(TTM)1.41
OCFY0.88%
SpS7.71
BVpS9.33
TBVpS8.92
PEG (NY)5.66
PEG (5Y)1.71
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.1% | ||
| ROE | 19.34% | ||
| ROCE | 10.03% | ||
| ROIC | 8.12% | ||
| ROICexc | 15.22% | ||
| ROICexgc | 16.52% | ||
| OM | 12.5% | ||
| PM (TTM) | 23.42% | ||
| GM | 49.34% | ||
| FCFM | 18.14% |
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
ROICexcg growth 3Y37.8%
ROICexcg 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-Score5
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.51 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 50% | ||
| Cap/Sales | 0.16% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 142.76% | ||
| Profit Quality | 77.48% | ||
| Current Ratio | 3.85 | ||
| Quick Ratio | 3.85 | ||
| Altman-Z | 53.2 |
F-Score5
WACC8.03%
ROIC/WACC1.01
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)28.85%
EPS 3Y23.18%
EPS 5Y70.21%
EPS Q2Q%34.62%
EPS Next Y21.25%
EPS Next 2Y23.99%
EPS Next 3Y25.39%
EPS Next 5Y21.38%
Revenue 1Y (TTM)28.98%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.05%
Revenue Next Year28.03%
Revenue Next 2Y25.14%
Revenue Next 3Y23.74%
Revenue Next 5Y22.74%
EBIT growth 1Y61.34%
EBIT growth 3Y53.23%
EBIT growth 5YN/A
EBIT Next Year32.79%
EBIT Next 3Y33.64%
EBIT Next 5Y38.64%
FCF growth 1Y796.18%
FCF growth 3Y48.78%
FCF growth 5Y186.89%
OCF growth 1Y606.96%
OCF growth 3Y44.49%
OCF growth 5Y87.03%