Shopify

Shopify Inc. Q4 2017 Earnings Report

NYSE: SHOPTSE: SHOP
Management Commentary

-Our leadership role in commerce, together with the scale we have achieved, position us well to invest in our next phase of growth: one marked by expansion of our capabilities upmarket and down, in retail, in our ecosystem, and internationally.”said CFO Russ Jones.

-“That our merchants sold more in the fourth quarter than in all of 2015, achieving one billion dollars of this in just four days, speaks to how far we have come in the past few years,”

Financial Highlights

-Revenue increased 71% to $222.8 million vs. estimates of $209 million (USD).

-Net loss of $3 million, down from a loss of $8.9 million a year ago.

-Adjusted EPS of $0.15 vs. estimates of $0.05.

-2018 Guidance: revenue between $970 million and $990 million, adjusted operating loss of $5 million to adjusted operating profit of $5 million.

My Comments

-Shopify’s stock is up 22% since my last Earnings Report.

-During the recent correction, one may have expected Shopify’s stock to take a hit as it is deemed ‘overvalued’, yet the price held up, showing investor’s confidence in the future of the business.

-Some profit taking may occur in the short term as their outlook disappointed, providing a buying opportunity for long term investors.

-They have no debt on the balance sheet and almost a billion dollars in cash, thus minimising their impact on rising interest rates.

-From Bloomberg, slowing growth from Shopify’s users is something that one should keep an eye on.

Disclosure

I, Jared Flomen, do not own shares of Shopify.

Please consult a financial advisor before making investment decisions.

This report represents my views, not actionable advice.

Shopify is also a top pick.