Q: You responded to an earlier question today about SHOP's decline today with: Yipitdata, a cloud-tracking service, noted it estimated that SHOP gross payments volume growth decelerated 'significantly' over the past week of reporting (to Jan 22). If volume did drop significantly, would this not be something 'significant'? I can see a slight drop that gets washed out over a longer time frame but a big drop all of a sudden isn't a good sign. What would cause a significant drop? Also, how reliable is Yipitdata? I guess what I'm asking is if SHOP is still looked on favourably by 5i? Is there anything to be overly concerned with?
5i Research Answer:
Note the data service indicated 'growth' slowed, not that there was an actual decline in payments. If there was any material weakness SHOP would need to disclose it. Yipdata sells its services to 400 investment funds. We would consider it accurate but not infallible, and it does focus on short term data, which is fine for traders but not so helpful for investors. It is hard to ascertain reasons for a drop. It could be an abberation, it could be that consumers were simply elsewhere that weak, or it could mean an economic slowdown. We have no reason to change a positive view on the company based on this single data point.