Shopify: A Canadian Stock Worth More than a Browse

The bounce back has been tremendous for Shopify. Bottoming out at under C$500 at the start of the stock market crash in March 2020, Shopify (TSE:SHOP) has nearly quadrupled its Read More... The post Shopify: A Canadian Stock Worth More than a Browse appeared first on TipRanks Financial Blog.

Shopify: A Canadian Stock Worth More than a Browse

The bounce back has been tremendous for Shopify. Bottoming out at under C$500 at the start of the stock market crash in March 2020, Shopify (TSE:SHOP) has nearly quadrupled its stock price and still has investors asking how much higher it will climb by the end of the year. 

One cause for excitement is the recent announcement that Shop Pay, Shopify’s one-click checkout solution, will now be available to merchants selling on Facebook or Google in the U.S.  (See Shopify stock chart on TipRanks)

Integrating Shopify solutions with a one-click instant check out to non-Shopify stores operating on Facebook and Google will greatly expand Shopify’s reach even further. Quarterly earnings from April 28, 2021 report $2.01 earnings per share for the quarter, beating most analyst forecasts. 

This household name is one of the most expensive Canadian e-com stocks in the market. With a strong indication of immediate growth, the Shop app has tracked more than 430 million orders year to date, according to a company statement.

“Since its launch, Shop Pay has set the standard for the checkout experience facilitating more than $24 billion in orders,” said Carl Rivera, Shopify VP, who heads Shop’s Product for Shop.

Expectations Remain High for Investors 

Shopify’s total revenue in the first quarter was $988.6 million. Subscription and merchant solutions account for nearly all of its revenue. Meanwhile, its growth accelerated 110% year-over-year. 

The company’s business model is just that, a model for success. Looking at its cost of revenue, Shopify spent $58,382 million on its software subscription solution to make $988.6 million in the first quarter. 

Driven primarily by the increase in gross merchandise volume (GMS), merchant solutions revenue was $668 million, with growth accelerating 137%. With a long list of first-quarter business highlights, Shopify has begun to harvest success from its recent partnerships, purchases and optimization strategies. 

Analysts' View

According to TipRanks’ analyst rating, SHOP is a Moderate Buy. From 22 analysts, there are 13 Buy and 9 Hold ratings. The average analyst Shopify price target is C$1,859.19 per share with a high forecast of C$2368.92 and a low forecast of C$1,670.71.

Bottom Line

Shopify is the standard for e-commerce solutions. As it ramps up its superior solutions, Shopify's platform is quickly becoming integrated more and more into daily consumer life. Among many key success factors for the company, investors look at Shop Pay as the hope for what the future holds for shareholders. Unmatched solutions such as Shop Pay, which brings a 70% faster checkout experience compared to current e-com, also boasts a 1.72x higher conversion rate, according to Shopify’s analytics. 

The company will continue growing expeditiously, and its large cash balance will bring new money to invest. Shopify is not cheap to buy, so investors may think twice when pulling the trigger. As the company scales up, buyers will be paying a very high price for a stock that was four times less nearly fifteen months ago. 

If you think Shopify will continue this type of growth, and consider the stock undervalued, you may not be alone. The most challenging part of 2021 for Shopify is keeping up with expectations from analysts and stock holders.

Disclosure: Lukas Brenowitz held no position in any of the stocks mentioned in this article at the time of publication.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.

The post Shopify: A Canadian Stock Worth More than a Browse appeared first on TipRanks Financial Blog.

Source : Tip Ranks More   

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Ping Identity: A Cheap Way To Play Cybersecurity

It has been a tough week for shareholders of Ping Identity (PING), which operates an identity software platform. The company announced the follow-on offering of 6 million shares from one Read More... The post Ping Identity: A Cheap Way To Play Cybersecurity appeared first on TipRanks Financial Blog.

Ping Identity: A Cheap Way To Play Cybersecurity

It has been a tough week for shareholders of Ping Identity (PING), which operates an identity software platform. The company announced the follow-on offering of 6 million shares from one of its major investors, Vista Equity Partners. The deal was struck at $24 but has swiftly tumbled on the news. Stocks are now fetching $23.70 – which is quite a bit short of the 52-week high -- and the market capitalization is $1.9 billion.

Ping Identity came public back on September 29. On the debut, the stock price rose by 34%. With so many tech companies coming public, Ping Identity has gotten lost in the noise. Yet this may present an opportunity for investors. (See Ping stock chart on TipRanks)

Backgrounder on Ping Identity

Ping Identity has actually been around for nearly 20 years, and this is perhaps one of its biggest issues for Wall Street. The company has had to transition its technology to the cloud, which has not been easy or cheap.

Nonetheless, the effort is starting to gain traction. Ping Identity now has a comprehensive platform that helps companies achieve zero trust security for the use of corporate IT systems. This can be done either via SaaS (software as a service), mobile, the cloud or on-premise. For the most part, Ping Identity is built for the complex needs of enterprises.

Artificial Intelligence (AI) and machine learning (ML) have also been key. These technologies have made it possible to detect unusual activity in real-time. It can do this in a way that does not interfere with a seamless user experience.

Significant Tailwinds for Ping

No doubt, there are a myriad of tailwinds for Ping Identity’s business. First of all, there is the trend towards digital transformation. This has required tools like identity management to help with the different software systems.

Next, with the Covid-19 pandemic, companies have had to deal with remote workforces. But this has added another layer of complexity to IT. Who is really logging on to a system? Well, with Ping Identity, this is much easier to monitor.

And finally, the number of cybersecurity threats continues to rise rapidly. It seems that every day there is a new ransomware incident. So yes, cybersecurity protection is a must-have.

As CEO Andre Durand noted on the latest earnings call, “With over 3.5 billion connected individuals and more than 350 billion digital identities connected to millions of applications, the challenge for enterprises to connect the right users to the right applications with speed and ease has never been greater.”

Wall Street’s Take

Turning to the analyst community, Ping Identity stock has 4 Buys and 4 Holds that have been assigned in the past three months. So, the shares are a Moderate Buy. At $31.21, the average analyst Ping Identity price target implies 37% upside potential.

Bottom Line On Ping Identity

In the latest quarter, Ping Identity posted a 16% increase in revenues to $266.3 million and operating cash flows came to $24.1 million. The dollar-based net retention rate was 109%.

True, the top-line is not too impressive. But then again, the past couple of quarters have seen an acceleration and the company has raised its guidance. The fact is that the cloud business is starting to move the needle—and this should allow for stronger long-term growth.

The valuation on Ping Identity stock is certainly attractive, at least compared to other enterprise software companies. Currently the shares trade at about 8 times revenues. By comparison, rival Okta (OKTA) is at a hefty 32X.

So for investors looking for a way to get exposure to the growth in cybersecurity, Ping Identity does look like an interesting option right now.

Disclosure: Tom Taulli does not have a position in Ping Identity stock.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.

The post Ping Identity: A Cheap Way To Play Cybersecurity appeared first on TipRanks Financial Blog.

Source : Tip Ranks More   

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