Shopify Inc (SHOP) Stock Analysis
Verdict: WATCH (do not buy)
High-multiple valuation (P/E 90x) leaves SHOP vulnerable to growth-rotation pullbacks, despite 32.5% top-line growth and $2B FCF.
Investment score: 54/100
Analysis as of
Is Shopify Inc stock worth reviewing? AI model thesis
The AI model evaluates Shopify as a HOLD. While $2.01B in annual free cash flow and 32.5% revenue growth showcase strong operating leverage post-logistics divestment, its demanding valuation (P/E 90.0x TTM, P/S 13.11x) and high Beta (2.70) expose the stock to severe multiple contraction during growth-to-value sector rotations.
7-factor investment score
- Valuation: 35/100 (weight 20%)
- Financial Health: 85/100 (weight 15%)
- Technical Momentum: 50/100 (weight 15%)
- Earnings Quality: 55/100 (weight 15%)
- Insider Sentiment: 50/100 (weight 10%)
- Analyst Consensus: 75/100 (weight 10%)
- Risk-Adjusted Return: 40/100 (weight 15%)
Shopify Inc opportunities and risks
What speaks for SHOP
- Expanding Enterprise Adoption via Shopify Plus and Cross-Border Tools
What speaks against SHOP
- Severe Valuation Multiple Compression Risk
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| SHOP | 90.0x | 13.1x | n/a | 47.8% | 14.5% | 1.4% |
| URL.CN | 220.3x | 1.8x | 22.4x | 24.5% | 0.9% | 5.1% |
| TCX | n/a | 0.3x | 16.9x | 24.9% | -21.2% | -12.1% |
| ECOM.V | n/a | 0.5x | 9.0x | 34.5% | -0.8% | 9.0% |
| SIX.CN | n/a | 319.6x | 5.5x | -522.6% | -72316.5% | -24.4% |
| MTLO.V | n/a | 0.5x | n/a | 86.5% | -90.1% | -59.6% |
| Peer median | n/a | 0.5x | 9.0x | 24.9% | -21.2% | -12.1% |
Frequently asked questions about Shopify Inc (SHOP)
Is SHOP stock a good investment?
The cached TradeMates AI model rates Shopify Inc as WATCH (do not buy) with an investment score of 54/100. The AI model evaluates Shopify as a HOLD. While $2.01B in annual free cash flow and 32.5% revenue growth showcase strong operating leverage post-logistics divestment, its demanding valuation (P/E 90.0x TTM, P/S 13.11x) and high Beta (2.70) expose the stock to severe multiple contraction during growth-to-value sector rotations. This is algorithmic model output, not personal investment advice.
Is SHOP stock a buy?
The TradeMates model verdict for SHOP is WATCH (do not buy) with an investment score of 54/100. Treat this as a model signal to review, not a personal buy recommendation.