● AI Equity Research · Technology

Shopify Inc. (SHOP)

AI stock analysis · Software - Application · Last analyzed Aug 16, 2026

Compass Score

3.0/5

Call

Hold

Price

$154.32

AI Target

$167.89 +8.8%

AI Analyst Summary

Shopify is a high-conviction growth compounder, with 68.1% YoY earnings growth reflecting accelerating operating leverage as its merchant platform and embedded financial services (Shopify Payments, Capital, and Installments) scale in tandem. Revenue growth of 33.7% YoY, combined with near-unanimous analyst buy-side support (40 of 52 rated analysts bullish), underscores durable demand for its commerce infrastructure. The primary risk is a valuation that leaves no room for execution missteps, with a trailing P/E of 104.3x and a PEG of 2.61 pricing in sustained perfection.

Catalysts

Q2 earnings release — further evidence of operating leverage if EPS growth continues to outpace revenue growth (>33.7% revenue, >68% EPS) would re-rate the stock toward analyst targets
Shopify Payments and financial services penetration — accelerating attach rates on Shopify Capital and Installments could meaningfully expand take rates and gross profit dollars in H2 2025
International merchant expansion — continued growth in non-North American GMV, particularly in Europe and Asia-Pacific, represents a large underpenetrated market that could drive the next leg of revenue acceleration

Fundamentals

Pe Trailing P/E: 104.3x | Forward P/E: 63.3x · 2.0/5

At 104.3x trailing and 63.3x forward, Shopify trades at a steep premium to the software sector median. While the elevated multiple reflects strong growth expectations, it leaves little margin of safety and is difficult to justify on a trailing basis alone.

Peg PEG: 2.61 · 2.0/5

A PEG of 2.61 is elevated — above the 2.0 threshold that typically signals stretched valuation relative to growth. While 68% earnings growth is impressive, the market is pricing in continued perfection, leaving limited upside buffer on a growth-adjusted basis.

Analyst Rating Buy consensus (1.7) · 4.0/5

With 40 Buy, 11 Hold, and 1 Sell across 46 analysts, the consensus rating of 1.7 reflects strong institutional conviction. Broad analyst coverage with overwhelming bullish skew is a constructive signal.

Earnings Trend EPS Growth YoY: +68.1% | Revenue Growth YoY: +33.7% · 5.0/5

68.1% YoY earnings growth materially exceeds the 25% threshold for a top score, and is complemented by 33.7% revenue growth. This combination reflects genuine operating leverage as Shopify scales its merchant ecosystem and financial services offerings.

Price Target Beat EPS Beat Rate: 3 of 4 quarters · 3.0/5

Beating in 3 of the last 4 quarters is in line with expectations — not a standout track record but broadly consistent execution. Only 4 quarters of data are available, capping this at a neutral score per methodology.

Management Consistent executor with strong analyst backing · 4.0/5

Strong earnings growth, a 75% beat rate over recent quarters, and overwhelming analyst confidence suggest management is executing well on its operating leverage story. Capital allocation appears disciplined given the margin expansion implied by EPS outpacing revenue growth.

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