In the latest close session, Shopify (SHOP) was down 1.16% at $123.03. This change lagged the S&P 500's 0.89% gain on the day. Elsewhere, the Dow gained 0.74%, while the tech-heavy Nasdaq added 1.29%.
Prior to today's trading, shares of the cloud-based commerce company had gained 15.28% outpaced the Computer and Technology sector's loss of 6.6% and the S&P 500's loss of 0.63%.
Market participants will be closely following the financial results of Shopify in its upcoming release. The company plans to announce its earnings on August 5, 2026. The company's earnings per share (EPS) are projected to be $0.39, reflecting a 11.43% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $3.43 billion, showing a 28.1% escalation compared to the year-ago quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.84 per share and revenue of $14.72 billion, indicating changes of +57.26% and +27.37%, respectively, compared to the previous year.
Investors should also pay attention to any latest changes in analyst estimates for Shopify. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. As of now, Shopify holds a Zacks Rank of #1 (Strong Buy).
From a valuation perspective, Shopify is currently exchanging hands at a Forward P/E ratio of 67.76. This signifies a premium in comparison to the average Forward P/E of 17.28 for its industry.
It is also worth noting that SHOP currently has a PEG ratio of 2.05. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Internet - Services industry was having an average PEG ratio of 1.87.
The Internet - Services industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 100, this industry ranks in the top 41% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Shopify Inc. (SHOP): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).