Options traders believe Shopify (SHOP) shares could experience a selloff after the company reports earnings before the market opens on Nov. 3. Consensus is for the Canadian e-commerce company to report $0.33 in earnings per share (EPS) for its third quarter, representing 22.22% year-over-year growth.
Heading into the quarterly print, Shopify stock is hovering around the same price at which it started 2026.
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www.barchart.comOptions Data Points to a Post-Earnings Drop in SHOP Stock
In the derivatives market, a put-to-call ratio of more than 1.00x is typically interpreted as bearish. That metric for SHOP contracts expiring Nov. 6 sits at 1.17x as of this writing. According to the latest data from Barchart, the lower price on those options contracts is set at roughly $137, indicating potential for an 11.43% decline through the end of next week.
The bearish sentiment is reflected in the technical setup as well. SHOP stock has recently slipped below its 20-day moving average (MA), indicating bears have taken back control of the near term.
Shopify Shares Are Not Inexpensive to Own
Valuation is another key concern investors must scrutinize before buying Shopify shares at present levels. The e-commerce behemoth is currently trading at a forward price-to-earnings (P/E) ratio of about 115x, which makes it significantly more expensive to own than rivals, including Etsy (ETSY).
Investors should also note that insiders have predominantly unloaded company shares in the trailing 12 months, recording 56 sells against not even a single buy, the optics of which are clearly bearish for SHOP.
On the flip side, however, Shopify has a history of closing November with a 12.63% gain on average, a seasonal trend that makes it somewhat more attractive to own in the near term.
How Wall Street Recommends Playing Shopify
Wall Street firms seem to disagree with the options market sentiment heading into Shopify’s earnings event.
According to Barchart, the consensus rating on SHOP shares remains at “Strong Buy,” with the mean price target of about $179 indicating potential upside of roughly 15% from here.
www.barchart.com On the date of publication, Wajeeh Khan did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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