SHOPIFY SHARES DROP
- Shares of Shopify $SHOP+1.1% fell 13% after the company released its quarterly results, despite beating estimates.
- Shopify $SHOP+1.1%'s revenue and gross merchandise volume saw growth.
- The drop in stock value is likely due to concerns about costs and the outlook for the future.
- Shopify $SHOP+1.1%'s underlying fundamentals are still sound.
- Despite Friday's stock drop, investors are expected to see modest gains.
The selloff pushed the price to earnings ratio below 15 and the outlook for the first quarter is also a bad reason to sell the stock. In fact, management explained that the increase in operating costs was due to higher marketing and payroll expenses, which should help drive sales growth in future quarters.
Shopify $SHOP+1.1% 's overall results were good and show that the company has recovered from the downturn in e-commerce during the economic recovery that came after the pandemic. Revenue in the quarter rose 24% to $2.14 billion, or 30% excluding the impact of the sale of the logistics business. The result beat estimates of $2.08 billion.
Would you consider the company for inclusion in your portfolio over the long term?
