stock was climbing Tuesday after an upgrade of the e-commerce platform’s stock.
BofA Securities analyst Brad Sills upgraded
stock to Buy from Neutral, and raised his price target to $82 from $78, which implies a 28% increase to the stock’s closing price Monday of $64.21.
“Following years of declining margin, we believe that the company has turned a corner on balanced growth and margin, under new CFO Jeff Hoffmeister,” Sills wrote in a research note. He forecasts “solid revenue growth and FCF conversion from here,” driven by solid baseline e-commerce growth, steady share gains, and disciplined expense spending.
Shares were rising 5.5% Tuesday to $67.77. The
was up 0.2%.
More analysts have become bullish on
this year, even as shares have dropped 60% from a record high set in November 2021. Of the 49 analysts surveyed on FactSet, 28 say the stock is a Buy, 21 are at Hold, and none have Sell ratings. That’s a change from a year ago, when out of 46 surveyed, 20 had Buy ratings, 24 were at Hold, and two were bears.
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Wolfe Research analyst Shweta Khajuria initiated coverage Tuesday of Shopify with an Outperform rating and $80 price target.
Khajuria wrote in a note that Shopify is extending its leadership position “with ongoing share gains driven by successful product execution and TAM [total addressable market] expansion as the company adds Enterprise customers, grows in international markets, expands its Offline products, improves its cross-selling efforts, and scales its new/emerging products.”
In June, Evercore ISI analyst Mark Mahaney upgraded Shopify stock to Outperform from In-Line and gave the stock a $75 price target.
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Mahaney wrote in a research note at the time that there is a “very resilient Long Thesis to SHOP shares, given its very large TAM, its very strong competitive position and up-market opportunity, its clear track record of successful product innovation, and the potential for materially ramping profitability.”
Shopify is scheduled to release second-quarter earnings on Aug. 7.
Corrections & amplifications: Shopify is scheduled to release second-quarter results on Aug. 7. A previous version of this article incorrectly said the company reports on July 31.
Write to Angela Palumbo at angela.palumbo@dowjones.com
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