Shopify: Setting Up Shop

Shopify: Setting Up Shop

CMA is pleased to showcase, in partnership with CIBC, the latest research on Shopify Inc. from their Institutional Equity Research team.

Shopify is a cloud-based, e-commerce SaaS software platform that allows online merchants to manage all business aspects, from products to orders to customers. As of September 28, CIBC Institutional Equity Research initiates coverage of Shopify Inc with a Sector Outperformer rating and price target of $60. Since listing on the NYSE on May 21, 2015 at $17, SHOP's results have exceeded expectations, with its market share price rising to ~$41. This latest research points to the conclusion that Shopify will continue to outgrow the e-commerce market. For each of the last six quarters, Shopify's sales growth has been ~90% vs. ~15% for U.S. e-commerce sales. 

 

 

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Key Takeaways:

  • The total available market for Shopify is 10 million SMBs in its core markets of the U.S., Canada, Europe, and Australia and 46 million globally (from two revenue streams: monthly subscription sales and a percentage of gross merchandise value that flows through its platform).
  • Through testing, the research determines that the Shopify platform offers the top solution, including best-in-class tools, apps, search engine optimization, channel partner access and support.
  • Shopify is growing at 6x the market and aims to build a dominant global footprint. 

Tags: shopify, e-commerce, financial, cibc, market share, SaaS, software