SHOPIFY INC - CLASS A (SHOP) Stock Fundamental Analysis
NASDAQ:SHOP - CA82509L1076 - Common Stock
140.53 USD
-1.58 (-1.11%)
140.35 USD
-0.18 (-0.13%)
SHOP gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 83 industry peers in the IT Services industry. While SHOP has a great health rating, its profitability is only average at the moment. SHOP is valued quite expensively, but it does show have an excellent growth rating. These ratings would make SHOP suitable for growth investing!
1. Profitability
1.1 Basic Checks
SHOP had positive earnings in the past year.
SHOP had a positive operating cash flow in the past year.
SHOP had positive earnings in 4 of the past 5 years.
SHOP had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
SHOP has a Return On Assets of 16.10%. This is amongst the best in the industry. SHOP outperforms 96.39% of its industry peers.
The Return On Equity of SHOP (19.34%) is better than 83.13% of its industry peers.
SHOP has a better Return On Invested Capital (8.12%) than 69.88% 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 96.39% of its industry peers.
In the last couple of years the Profit Margin of SHOP has declined.
With a decent Operating Margin value of 12.50%, SHOP is doing good in the industry, outperforming 75.90% of the companies in the same industry.
In the last couple of years the Operating Margin of SHOP has grown nicely.
SHOP's Gross Margin of 49.34% is fine compared to the rest of the industry. SHOP outperforms 68.67% 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
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
The debt/assets ratio for SHOP has been reduced compared to a year ago.
2.2 Solvency
SHOP has an Altman-Z score of 47.11. This indicates that SHOP is financially healthy and has little risk of bankruptcy at the moment.
SHOP's Altman-Z score of 47.11 is amongst the best of the industry. SHOP outperforms 98.80% 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 | 47.11 |
ROIC/WACC0.94
WACC8.62%
2.3 Liquidity
A Current Ratio of 3.85 indicates that SHOP has no problem at all paying its short term obligations.
The Current ratio of SHOP (3.85) is better than 86.75% 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.
With an excellent Quick ratio value of 3.85, SHOP belongs to the best of the industry, outperforming 86.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.85 | ||
| Quick Ratio | 3.85 |
3. Growth
3.1 Past
SHOP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 28.85%, which is quite impressive.
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.
SHOP shows a strong growth in Revenue. In the last year, the Revenue has grown by 28.98%.
SHOP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 41.27% yearly.
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.
The Revenue is expected to grow by 22.74% on average over the next years. This is a very strong growth
EPS Next Y22.08%
EPS Next 2Y24.17%
EPS Next 3Y25.76%
EPS Next 5Y21.38%
Revenue Next Year27.61%
Revenue Next 2Y24.84%
Revenue Next 3Y23.51%
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
The Price/Earnings ratio is 104.87, which means the current valuation is very expensive for SHOP.
SHOP's Price/Earnings ratio is in line with the industry average.
SHOP is valuated expensively when we compare the Price/Earnings ratio to 27.03, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 75.95, the valuation of SHOP can be described as expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SHOP is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 22.63. SHOP is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 104.87 | ||
| Fwd PE | 75.95 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SHOP indicates a slightly more expensive valuation: SHOP is more expensive than 68.67% of the companies listed in the same industry.
SHOP's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 100.52 | ||
| EV/EBITDA | 136.69 |
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.
SHOP's earnings are expected to grow with 25.76% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.75
PEG (5Y)1.49
EPS Next 2Y24.17%
EPS Next 3Y25.76%
5. Dividend
5.1 Amount
No dividends for SHOP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
140.53
-1.58 (-1.11%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners75.49%
Inst Owner Change-0.69%
Ins Owners0.11%
Ins Owner ChangeN/A
Market Cap182.64B
Analysts77.5
Price Target159.15 (13.25%)
Short Float %1.87%
Short Ratio2.65
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)35.94%
PT rev (3m)30.44%
EPS NQ rev (1m)-3.52%
EPS NQ rev (3m)-9.2%
EPS NY rev (1m)2.02%
EPS NY rev (3m)2.14%
Revenue NQ rev (1m)4.33%
Revenue NQ rev (3m)3.44%
Revenue NY rev (1m)3.12%
Revenue NY rev (3m)3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 104.87 | ||
| Fwd PE | 75.95 | ||
| P/S | 18.24 | ||
| P/FCF | 100.52 | ||
| P/OCF | 99.64 | ||
| P/B | 15.06 | ||
| P/tB | 15.75 | ||
| EV/EBITDA | 136.69 |
EPS(TTM)1.34
EY0.95%
EPS(NY)1.85
Fwd EY1.32%
FCF(TTM)1.4
FCFY0.99%
OCF(TTM)1.41
OCFY1%
SpS7.71
BVpS9.33
TBVpS8.92
PEG (NY)4.75
PEG (5Y)1.49
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 | 47.11 |
F-Score5
WACC8.62%
ROIC/WACC0.94
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 Y22.08%
EPS Next 2Y24.17%
EPS Next 3Y25.76%
EPS Next 5Y21.38%
Revenue 1Y (TTM)28.98%
Revenue growth 3Y24.41%
Revenue growth 5Y41.27%
Sales Q2Q%31.05%
Revenue Next Year27.61%
Revenue Next 2Y24.84%
Revenue Next 3Y23.51%
Revenue Next 5Y22.74%
EBIT growth 1Y61.34%
EBIT growth 3Y53.23%
EBIT growth 5YN/A
EBIT Next Year30.54%
EBIT Next 3Y33.18%
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%