SHOPIFY INC - CLASS A (SHOP) Stock Fundamental Analysis
USA - NASDAQ:SHOP - CA82509L1076 - Common Stock
175.97 USD
+0.91 (+0.52%)
Overall SHOP gets a fundamental rating of 6 out of 10. We evaluated SHOP against 85 industry peers in the IT Services industry. SHOP has an excellent financial health rating, but there are some minor concerns on its profitability. SHOP shows excellent growth, but is valued quite expensive already. With these ratings, SHOP could be worth investigating further for growth 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.
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 96.47% of its industry peers.
SHOP's Return On Equity of 19.34% is amongst the best of the industry. SHOP outperforms 83.53% of its industry peers.
SHOP has a Return On Invested Capital of 8.12%. This is in the better half of the industry: SHOP outperforms 69.41% 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
SHOP's Profit Margin of 23.42% is amongst the best of the industry. SHOP outperforms 96.47% of its industry peers.
SHOP's Profit Margin has declined in the last couple of years.
SHOP's Operating Margin of 12.50% is fine compared to the rest of the industry. SHOP outperforms 75.29% of its industry peers.
SHOP's Operating Margin has improved in the last couple of years.
SHOP has a better Gross Margin (49.34%) than 67.06% of its industry peers.
SHOP's Gross Margin has declined in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SHOP is destroying value.
SHOP has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, SHOP has more shares outstanding
Compared to 1 year ago, SHOP has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 57.65 indicates that SHOP is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 57.65, SHOP belongs to the best of the industry, outperforming 98.82% of the companies in the same industry.
There is no outstanding debt for SHOP. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.51 | ||
| Altman-Z | 57.65 |
ROIC/WACC0.98
WACC8.28%
2.3 Liquidity
A Current Ratio of 3.85 indicates that SHOP has no problem at all paying its short term obligations.
SHOP has a better Current ratio (3.85) than 85.88% of its industry peers.
SHOP has a Quick 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 Quick ratio (3.85) than 85.88% of its industry peers.
| 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
Looking at the last year, SHOP shows a very strong growth in Revenue. The Revenue has grown by 28.98%.
Measured over the past years, SHOP shows a very strong growth in Revenue. The Revenue has been growing by 41.27% on average per year.
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
SHOP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.38% yearly.
Based on estimates for the next years, SHOP will show a very strong growth in Revenue. The Revenue will grow by 22.74% on average per year.
EPS Next Y23.07%
EPS Next 2Y24.77%
EPS Next 3Y25.97%
EPS Next 5Y21.38%
Revenue Next Year28.09%
Revenue Next 2Y25.19%
Revenue Next 3Y23.74%
Revenue Next 5Y22.74%
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 131.32.
SHOP's Price/Earnings ratio is in line with the industry average.
SHOP is valuated expensively when we compare the Price/Earnings ratio to 27.08, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 94.20, the valuation of SHOP can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as SHOP.
When comparing the Price/Forward Earnings ratio of SHOP to the average of the S&P500 Index (23.09), we can say SHOP is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 131.32 | ||
| Fwd PE | 94.2 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, SHOP is valued a bit more expensive than 68.24% 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 | 125.87 | ||
| EV/EBITDA | 170.05 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SHOP does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of SHOP may justify a higher PE ratio.
SHOP's earnings are expected to grow with 25.97% in the coming years. This may justify a more expensive valuation.
PEG (NY)5.69
PEG (5Y)1.87
EPS Next 2Y24.77%
EPS Next 3Y25.97%
5. Dividend
5.1 Amount
No dividends for SHOP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NASDAQ:SHOP (10/28/2025, 10:42:09 AM)
175.97
+0.91 (+0.52%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners74.51%
Inst Owner Change0.13%
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap228.70B
Revenue(TTM)10.01B
Net Income(TTM)2.35B
Analysts76.07
Price Target162.41 (-7.71%)
Short Float %1.72%
Short Ratio2.98
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)1.2%
Min Revenue beat(2)-0.72%
Max Revenue beat(2)3.12%
Revenue beat(4)3
Avg Revenue beat(4)0.9%
Min Revenue beat(4)-0.72%
Max Revenue beat(4)3.12%
Revenue beat(8)5
Avg Revenue beat(8)0.48%
Revenue beat(12)9
Avg Revenue beat(12)1.06%
Revenue beat(16)10
Avg Revenue beat(16)0.03%
PT rev (1m)0.92%
PT rev (3m)38.73%
EPS NQ rev (1m)0.65%
EPS NQ rev (3m)-3.17%
EPS NY rev (1m)1.5%
EPS NY rev (3m)2.84%
Revenue NQ rev (1m)0.11%
Revenue NQ rev (3m)4.93%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)3.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 131.32 | ||
| Fwd PE | 94.2 | ||
| P/S | 22.84 | ||
| P/FCF | 125.87 | ||
| P/OCF | 124.77 | ||
| P/B | 18.86 | ||
| P/tB | 19.72 | ||
| EV/EBITDA | 170.05 |
EPS(TTM)1.34
EY0.76%
EPS(NY)1.87
Fwd EY1.06%
FCF(TTM)1.4
FCFY0.79%
OCF(TTM)1.41
OCFY0.8%
SpS7.71
BVpS9.33
TBVpS8.92
PEG (NY)5.69
PEG (5Y)1.87
Graham Number16.77
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
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-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 | 57.65 |
F-Score5
WACC8.28%
ROIC/WACC0.98
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 Y23.07%
EPS Next 2Y24.77%
EPS Next 3Y25.97%
EPS Next 5Y21.38%
Revenue 1Y (TTM)28.98%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.05%
Revenue Next Year28.09%
Revenue Next 2Y25.19%
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%
SHOPIFY INC - CLASS A / SHOP FAQ
What is the ChartMill fundamental rating of SHOPIFY INC - CLASS A (SHOP) stock?
ChartMill assigns a fundamental rating of 6 / 10 to SHOP.
What is the valuation status of SHOPIFY INC - CLASS A (SHOP) stock?
ChartMill assigns a valuation rating of 2 / 10 to SHOPIFY INC - CLASS A (SHOP). This can be considered as Overvalued.
What is the profitability of SHOP stock?
SHOPIFY INC - CLASS A (SHOP) has a profitability rating of 6 / 10.
What is the financial health of SHOPIFY INC - CLASS A (SHOP) stock?
The financial health rating of SHOPIFY INC - CLASS A (SHOP) is 8 / 10.
What is the earnings growth outlook for SHOPIFY INC - CLASS A?
The Earnings per Share (EPS) of SHOPIFY INC - CLASS A (SHOP) is expected to grow by 23.07% in the next year.