Shopify Stock ( NYSE:SHOP )
Shares of Shopify ( NYSE:SHOP ) fell during the first part of Thursday’s trading session, reaching a low of $36.56 per share. This came after UBS initiated coverage of the company with a Sell rating and set a price target of $30 for the Shopify stock.
As stated by analysts in a letter to investors, the long-term strategy of the firm and the competition are expected to influence both Shopify’s top and bottom lines. According to UBS, there is a potential threat to Shopify’s bottom line and its top line in the short future.
According to the analysts’ writing, Shopify is now “developing a retail ‘operating system’ and is the worldwide leader in eCommerce platforms internationally.”
They said that the following factors are the basis for the firm’s Sell rating:
According to its regression analysis and UBS’s expectations for personal consumption expenditures, the Street consensus estimates for GMV and revenue are not derisked for a recession in the first half of 2019.
According to recent polls, Shopify stock may face a severe threat to its top line in the long run from Amazon’s (NASDAQ:AMZN) Buy with Prime program.
In addition, the analysts pointed out that UBS’s comprehensive research into logistics hints that SHOP’s original guidance of $1 billion of CAPEX in 2023/24 is likely to remain the same. In the meanwhile, the fact that AMAZON operates its logistics at a loss has wider pockets given its wealth and greater take rate, a...
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