Shopify Still Has Room to Increase Its Stock in 2018
Rapid growth stock, Shopify, grew in worth more than 137 percent in 2017. It still has plenty of growth room in 2018. According to Wall Street, it’s one to watch this year, too.
Shopify (NYSE: SHOP) began as an e-commerce snowboard shop. Its creator recognized the importance of an easy to set up an online store and soon started helping other businesses set up shop, too. What began as a five-person operation in 2006, now employees more than 2,000 people across five offices.
Based in Ottawa, Canada, the firm hosts 500,000 merchants from 175 countries. Those merchants have generated a combined $46 billion in sales. Their success means Shopify success. In 2017, its stock price exceeded $100 per share.
That’s far from its likely peak since e-commerce continues to grow. According to the National Retail Federation, 2017 online sales increased an estimated 8 to 12 percent from 2016. That growth far exceeds brick-and-mortar sales with an estimated increase of only 4.2 percent from 3.7 percent.
According to Shopify’s 2017 third-quarter data, its merchant numbers have grown an average of 74 percent annually since 2012. If the rate holds, its merchant number could hit one million by the close of 2018. It also experienced year-over-year revenue increase of 72 percent to $171.5 million.
Something for Everyone
Part of Shopify’s success is its flexibility. Unlike eBay or Etsy, it doesn’t cater to a niche. It serves all sizes of companies wanting an easy way to sell online. It hosts small, medium and large businesses. From sole proprietors to massive corporations like Fossil, Nestle and Procter and Gamble, Shopify hosts their e-commerce offerings.
Add to that a ridiculously large worldwide potential for growth. Currently, about 46 million merchants with 500 or fewer employees don’t sell online yet. In Shopify’s current geo-target of Australia, Canada, New Zealand, UK, US, and Western Europe there exists 10 million such merchants. That provides an ample target plus territory growth for a company already hosting half a million shops.
While 2017 already provided a banner year for the Canadian firm, Shopify has more to look forward to in 2018. With e-commerce continuing to grow, so will Shopify, and its stock price right along with it.