Shopify Inc.’s (NYSE: SHOP) multi-tenant, cloud-based, multi-channel commerce platform has helped numerous small and medium-sized businesses thrive. The fact that it is a brand-oriented platform rather than a typical online marketplace is Shopify’s biggest unique selling proposition, as this helps sellers acquire customers more quickly than through focused interaction.
Shopify’s software helps merchants conduct business across various sales channels, including the online marketplace storefronts, social media outlets, and brick-and-mortar and flash retail shops.
Operating predominantly through its online portals, namely shopify.com and shopify.in, the company’s revenues depend on the volume of visits to the website. Interestingly, we found valuable insights from TipRanks’ new tool, which showed us some encouraging trends on the platform, which might be a relief for the company’s shares after languishing in the market for the past year.
Website Trends Give Hope
We found that in the first quarter of 2022, the total estimated visits to both of Shopify’s portals together increased 17.22% from the previous quarter. This is uplifting because the more the visits to Shopify’s website, the more the chances of that translating into sales.
This uptrend is in line with the company’s current efforts to attract more merchants to the platform through aggressive sales and marketing. In all possibility, the increase in traffic may be a result of increased marketing activity.
Now, in the last earnings call, management had mentioned that they expect revenue growth to slow down in Q1 due to a tough comparison from last year’s COVID-19 driven ecommerce boom.
However, going by the insights we gathered from the tool, there is hope for Shopify. Interestingly, when compared on a year-over-year basis, there was an uptrend there as well, with a 46.93% increase in estimated website visits in Q1’22 from Q1’21.
Parting Thoughts
All things said, there are still various other facets of the business that need to be examined before considering the stock as an investment, as website trends only tell one part of the story. For instance, solid growth in Merchant Solutions revenues is in the forecast due to accelerated global expansion and introductions of several new features like Shopify Markets.
Moreover, analysts are more bullish on the stock in the past month than they were toward the beginning of the year.
Wall Street consensus maintains a cautiously optimistic stance on Shopify, based on 14 Buys and 13 Holds. The Shopify stock projections point at an average price target of $982.44, suggesting an upside potential of 63.60% as of 10:53 a.m. EST, Monday.
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
Read full Disclaimer & Disclosure.
from WordPress https://ift.tt/WzXm2CL
via IFTTT
0 Comments