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  5. SHOP: Good Morning, SHOP is currently trading at the same level it was in April 2020. [Shopify Inc. Class A Subordinate Voting Shares]
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Q: Good Morning,

SHOP is currently trading at the same level it was in April 2020. In 4 years it has done nothing.

It's down 70% from its all time high.

The 'street' rates it as a moderate buy with 10 buys and 7 holds. After earnings announced on May 8 it is down 18%,

How can 5i be so bullish on this stock? It has become a Hopeify.

William O'Neil would have an interesting debate with you on this one.

Sheldon
Asked by Sheldon on May 27, 2024
5i Research Answer:

Our data shows SHOP is up 113% in five years. Oops, our bad, the question states four years. But our point is that picking an arbitrary time frame can change perspective. Yes, SHOP is well down from the peak, but up 5-fold from its IPO less than 10 years ago. Does that make it good or bad? Again, considering that timeframe chosen can vary results, looking at fundamentals we see EPS of 19c in 2020, even with Covid, rising to $1.26 next year. Some might consider 563% earnings growth in five years good. Cash is more than $4B. We do not know if it will be a long term winner. But it essentially is in a global duopoly position, which often works well. Also, any long term winning stock has always seen periods of massive drawdowns in stock price. It comes with the territory of big growth and big stock moves. We like it from current levels, but not everyone has to.