Q: What’s happening with SHOP? It’s spinning it’s wheels and slowly losing traction. What will it take to get the price moving up? When does it next report and what does 5i expect? Is it still one of your favourites or is it gradually moving to the sidelines?
5i Research Answer:
For a Canadian growth company, we still like SHOP a lot. It is down 13% YTD but still up 7% in 52-weeks. As a $115B company there are always lots of news releases, but nothing of real note recently. It has partnered with several retailers which should be positive. Investors may be worried about consumer spending, and we have seen some weak reports from consumer-facing companies in the past few months. But EPS is expected to rise 4X this year and another 25%+ in 2025. As interest rates fall the stock and its future cash flow could get valued more highly.