Shopify gains after landing Outperform rating from Wedbush Securities
Sean Gallup
Wedbush Securities started off coverage on Shopify (NYSE:SHOP) on Tuesday with an Outperform rating and price target of $62. Analyst Scott Devitt and team noted that the digital powerhouse accounts for over 10% of U.S. e-commerce and powers millions of brands online ranging from SMBs to large retailers.
“Given its scale (~$230B in 2023E GMV) and strong competitive positioning, Shopify has the opportunity to upsell merchants with new products and services leading to take rate expansion over time.”
Shopify (SHOP) was also noted to be expanding its services to non-Shopify merchants through Shopify Commerce Components, which was said to give enterprises the flexibility to adopt Shopify services that meet their specific needs. Wedbush sees the Shopify (SHOP) strategy as expanding the Ottawa-based company’s addressable market and presenting incremental monetization opportunities, particularly for the company’s core payments offering.
The bullish view is that Shopify’s (SHOP) potential to deepen monetization is multi-faceted with continued payments adoption in addition to off -platform opportunities in play, as well as other merchant services growth that should drive sustainable take rate expansion for the foreseeable future.
Shares of Shopify (SHOP) rose 1.55% in premarket trading to $54.77.
