Analysts are revising their price targets on Shopify stock ahead of the holidays

Shopify (STORE) he just wants 30 minutes of your time.

The e-commerce platform, which creates tools for businesses to sell their products, is urging retailers to get ready for the holidays with a half-hour course to help guide them through the most wonderful time of the year.

Related: Analysts Revise Price Target on Shopify Shares After Earnings

“By investing 30 minutes of your time, you can unlock the potential for increased sales, customer engagement and overall success this holiday season,” the company said on its blog last month. “Let’s make this peak season one for the books!”

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Shopify, which was founded in 2006, hosts 5.6 million active stores in 175 countries as of this year.

Black Friday and Cyber ​​Monday are just around the corner, the company said, and “now is the perfect time to arm yourself with the knowledge and strategies to make this holiday season a success.”

“That’s where Shopify Academy’s comprehensive new course: Planning for Peak Season 2024 comes in,” Shopify said, adding that the 30-minute course “is designed to help you navigate the complexities of peak season sales, making sure you don’t you are only prepared, but prepared for success.”

Analysts expect a somewhat muted shopping season this year.

Shopify urges merchants to prepare for the holidays

The Boston Consulting Group’s 2024 Holiday Outlook forecast a mixed growth outlook for the holiday season.

Related: Goldman Sachs analyst revises S&P 500 targets for 2024 and 2025

The research firm said that while just over a quarter of consumers plan to spend more than they did last year, just over a quarter plan to spend less – and just under half plan to spend the same .

“On the one hand, real consumption has continued to grow in the post-pandemic era, and US household incomes and balance sheets are strong relative to historical levels,” BCG said. “Furthermore, both job growth and income growth are at levels similar to the pre-pandemic economy.”

But other factors keep all the good cheer in check, they say.

“Despite positive economic (growth) indicators, consumer sentiment has declined over the past two years,” Boston Consulting said. “Ongoing geopolitical tensions, global military conflicts, and the upcoming 2024 presidential election are creating an environment of divided attention for American consumers.”

In addition, the firm said, even though inflation has cooled recently, it has driven peak prices for consumer staples, thus tightening consumer budgets for holiday shopping and making for more intentional channel selection and deal-hunting across the board. the season.

Last year, Shopify said, its merchants reported $9.3 billion in sales over the Black Friday-Cyber ​​Monday weekend alone, up 24 percent from the previous year.

“The earlier you start preparing, the better positioned you will be to take advantage of the holiday season,” the company said.

Shopify stock is up 6.6% year-to-date and up 55% from a year ago. The company is scheduled to report earnings in a few weeks.

In August, Shopify beat Wall Street’s second-quarter earnings expectations and gave an upbeat forecast for the current period.

“Our relentless focus on our mission has not only empowered our merchants, but also strengthened Shopify significantly,” Chairman Harley Finkelstein told analysts. “We’re the strongest we’ve ever been and couldn’t be more excited about the future of commerce and Shopify.”

The company said gross merchandise volume, or the total volume of merchandise sold on the platform, rose 22 percent during the quarter to $67.2 billion.

CEO: “Shopify captures everything”

“These results reiterate what we’ve said all along (all along: we’re) building for the long term, and our business model is working,” Finkelstein said. “Whether online or offline, direct-to-consumer or (business-to-business) domestic or global, Shopify captures it all.”

“What makes Shopify so powerful is how all parts of the product work together, reducing complexity at every stage of a merchant’s journey,” he added.

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Investment firms updated their price targets for Shopify recently.

Loop Capital’s Anthony Chukumba raised the company’s price target on Shopify to $90 from $80, while affirming a hold rating on the stock.

The investment firm has updated its quarterly survey of current Shopify merchants to get a better view of the platform from their perspective.

Chukumba said he was “very encouraged” by the survey results, including incremental improvements in sales channel usage, merchant solution engagement, sales trends and merchant satisfaction.

He added, however, that the stock’s current valuation levels warrant a hold rating.

Baird raised his price target on Shopify to $90 from $79 and asserted an outperform rating on the stock.

The investment firm said that while SHOP stock is typically volatile around quarterly earnings, it continues to like the company following its latest survey on the platform, which suggests ongoing healthy growth in its core Shopify offerings Plus, international and enterprise.

Earlier this month, Barclays raised its price target on Shopify to $70 from $65, while maintaining an equal rating on the stock, as part of a third-quarter earnings preview for the group.

SHOP has continued its strong year-to-date performance, the analyst tells investors in a research note.

And last month, Citi raised its price target on Shopify to $103 from $90 and maintained a buy rating on the stock.

Recent conversations with the company have provided increased confidence in Shopify’s adoption of payments and cross-selling of select merchant solution products, the firm said.

Citi said it remained optimistic that revenue growth would accelerate in the second half of 2024, with its profitability expected to weigh on 2025. The firm views Wall Street’s outlook for Shopify as positive.

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