Shopify Profitability Analysis
| SHOP Stock | USD 112.67 0.03 0.03% |
Net Income | First Reported 2013-03-31 | Previous Quarter 264 M | Current Value 743 M | Quarterly Volatility 538.6 M |
| Current Value | Last Year | Change From Last Year | 10 Year Trend | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Gross Profit Margin | 0.62 | 0.4807 |
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For Shopify profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Shopify to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Shopify utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Shopify's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Shopify over time as well as its relative position and ranking within its peers.
Shopify's Revenue Breakdown by Earning Segment
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Shopify Revenue Breakdown by Earning Segment
By analyzing Shopify's earnings estimates, investors can diagnose different trends across Shopify's analyst sentiment over time as well as compare current estimates against different timeframes.
Can Internet Services & Infrastructure industry sustain growth momentum? Does Shopify have expansion opportunities? Factors like these will boost the valuation of Shopify. If investors know Shopify will grow in the future, the company's valuation will be higher. Determining accurate worth demands scrutiny of both present operating results and projected expansion capacity. Evaluating Shopify demands reviewing these metrics collectively while recognizing certain factors exert disproportionate influence.
Quarterly Earnings Growth (0.42) | Earnings Share 0.95 | Revenue Per Share | Quarterly Revenue Growth 0.306 | Return On Assets |
Investors evaluate Shopify using market value (trading price) and book value (balance sheet equity), each telling a different story. Calculating Shopify's intrinsic value - the estimated true worth - helps identify when the stock trades at a discount or premium to fair value. Market participants employ diverse analytical approaches to determine fair value and identify buying opportunities when prices dip below calculated worth. External factors like market trends, sector rotation, and investor psychology can cause Shopify's market price to deviate significantly from intrinsic value.
Please note, there is a significant difference between Shopify's value and its price as these two are different measures arrived at by different means. Investors typically determine if Shopify is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. Conversely, Shopify's market price signifies the transaction level at which participants voluntarily complete trades.
Shopify Return On Asset vs. Return On Equity Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Shopify's current stock value. Our valuation model uses many indicators to compare Shopify value to that of its competitors to determine the firm's financial worth. Shopify is rated below average in return on equity category among its peers. It is rated below average in return on asset category among its peers reporting about 0.83 of Return On Asset per Return On Equity. The ratio of Return On Equity to Return On Asset for Shopify is roughly 1.21 . At this time, Shopify's Return On Equity is relatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value Shopify by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.Shopify Return On Asset vs. Return On Equity
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Shopify |
| = | 0.0984 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Shopify |
| = | 0.0815 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
Shopify Return On Asset Comparison
Shopify is currently under evaluation in return on asset category among its peers.
Shopify Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Shopify, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Shopify will eventually generate negative long term returns. The profitability progress is the general direction of Shopify's change in net profit over the period of time. It can combine multiple indicators of Shopify, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Accumulated Other Comprehensive Income | 1000 K | 1.1 M | |
| Operating Income | 1.5 B | 1.5 B | |
| Income Before Tax | 1.5 B | 1.6 B | |
| Total Other Income Expense Net | 41 M | 39 M | |
| Net Income | 1.2 B | 1.3 B | |
| Income Tax Expense | 278 M | 291.9 M | |
| Net Income From Continuing Ops | 2.3 B | 2.4 B | |
| Net Income Applicable To Common Shares | 2.3 B | 2.4 B | |
| Interest Income | 354.2 M | 382.4 M | |
| Net Interest Income | 354.2 M | 371.9 M | |
| Change To Netincome | 3.8 B | 4 B | |
| Net Income Per Share | 0.95 | 1.00 | |
| Income Quality | 1.65 | 1.73 | |
| Net Income Per E B T | 0.82 | 1.09 |
Shopify Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Shopify. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Shopify position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Shopify's important profitability drivers and their relationship over time.
Shopify Profitability Trends
Shopify profitability trend refers to the progression of profit or loss within a business. An upward trend means that Shopify's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Shopify's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.
Shopify Profitability Drivers Correlations
One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Shopify different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Shopify in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Shopify's future profitability.
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Shopify Earnings Estimation Breakdown
The calculation of Shopify's earning per share is based on the data from the past 12 consecutive months, used for reporting the company's financial figures. The next projected EPS of Shopify is estimated to be 0.3271 with the future projection ranging from a low of 0.23 to a high of 0.39. Please be aware that this consensus of annual earnings estimates for Shopify is based on EPS before non-recurring items and includes expenses related to employee stock options.Last Reported EPS
0.23 Lowest | Expected EPS | 0.39 Highest |
Shopify Earnings Projection Consensus
Suppose the current estimates of Shopify's value are higher than the current market price of the Shopify stock. In this case, investors may conclude that Shopify is overpriced and will exhibit bullish sentiment. On the other hand, if the present value is lower than the stock price, analysts may conclude that the market undervalues the equity. These scenarios may suggest that the market is not as efficient as it should be at the estimation time, and Shopify's stock will quickly adjusts to the new information provided by the consensus estimate.
| Number of Analysts | Historical Accuracy | Last Reported EPS | Estimated EPS for 31st of March 2026 | Current EPS (TTM) | |
| 51 | 54.72% | 0.48 | 0.3271 | 0.95 |
Shopify Earnings per Share Projection vs Actual
Actual Earning per Share of Shopify refers to what the company shows during its earnings calls or quarterly reports. The Expected EPS is what analysts covering Shopify predict the company's earnings will be in the future. The higher the earnings per share of Shopify, the better is its profitability. While calculating the Earning per Share, we use the weighted ratio, as the number of shares outstanding can change over time.Shopify Estimated Months Earnings per Share
For an investor who is primarily interested in generating an income out of investing in entities such as Shopify, the EPS ratio can tell if the company is intending to increase its current dividend. Although EPS is an essential tool for investors, it should not be used in isolation. EPS of Shopify should always be considered in relation to other companies to make a more educated investment decision.Shopify Quarterly Analyst Estimates and Surprise Metrics
Earnings surprises can significantly impact Shopify's stock price both in the short term and over time. Negative earnings surprises usually result in a price decline. However, it has been seen that positive earnings surprises lead to an immediate rise in a stock's price and a gradual increase over time. This is why we often hear news about some companies beating earning projections. Financial analysts spend a large amount of time predicting earnings per share (EPS) along with other important future indicators. Many analysts use forecasting models, management guidance, and additional fundamental information to derive an EPS estimate.
| Reported | Fiscal Date | Estimated EPS | Reported EPS | Surprise | |||
|---|---|---|---|---|---|---|---|
2026-02-09 | 2025-12-31 | 0.5009 | 0.48 | -0.0209 | 4 | ||
2025-11-12 | 2025-09-30 | 0.34 | 0.34 | 0.0 | 0 | ||
2025-08-06 | 2025-06-30 | 0.2885 | 0.35 | 0.0615 | 21 | ||
2025-05-08 | 2025-03-31 | 0.26 | 0.25 | -0.01 | 3 | ||
2025-02-11 | 2024-12-31 | 0.43 | 0.44 | 0.01 | 2 | ||
2024-11-12 | 2024-09-30 | 0.18 | 0.64 | 0.46 | 255 | ||
2024-08-07 | 2024-06-30 | 0.2 | 0.26 | 0.06 | 30 | ||
2024-05-08 | 2024-03-31 | 0.17 | 0.2 | 0.03 | 17 | ||
2024-02-13 | 2023-12-31 | 0.31 | 0.34 | 0.03 | 9 | ||
2023-11-02 | 2023-09-30 | 0.14 | 0.24 | 0.1 | 71 | ||
2023-08-02 | 2023-06-30 | 0.05 | 0.14 | 0.09 | 180 | ||
2023-05-04 | 2023-03-31 | -0.04 | 0.01 | 0.05 | 125 | ||
2023-02-15 | 2022-12-31 | -0.01 | 0.07 | 0.08 | 800 | ||
2022-10-27 | 2022-09-30 | -0.07 | -0.02 | 0.05 | 71 | ||
2022-07-27 | 2022-06-30 | 0.02 | -0.03 | -0.05 | 250 | ||
2022-05-05 | 2022-03-31 | 0.06 | 0.02 | -0.04 | 66 | ||
2022-02-16 | 2021-12-31 | 0.13 | 0.14 | 0.01 | 7 | ||
2021-10-28 | 2021-09-30 | 0.12 | 0.08 | -0.04 | 33 | ||
2021-07-28 | 2021-06-30 | 0.1 | 0.22 | 0.12 | 120 | ||
2021-04-28 | 2021-03-31 | 0.07 | 0.2 | 0.13 | 185 | ||
2021-02-17 | 2020-12-31 | 0.13 | 0.16 | 0.03 | 23 | ||
2020-10-29 | 2020-09-30 | 0.05 | 0.11 | 0.06 | 120 | ||
2020-07-29 | 2020-06-30 | 0.01 | 0.11 | 0.1 | 1000 | ||
2020-05-06 | 2020-03-31 | -0.02 | 0.02 | 0.04 | 200 | ||
2020-02-12 | 2019-12-31 | 0.02 | 0.04 | 0.02 | 100 | ||
2019-10-29 | 2019-09-30 | 0.01 | 0.02 | 0.01 | 100 | ||
2019-08-01 | 2019-06-30 | 0.03 | 0.01 | -0.02 | 66 | ||
2019-04-30 | 2019-03-31 | -0.04 | 0.01 | 0.05 | 125 | ||
2019-02-12 | 2018-12-31 | 0.02 | 0.03 | 0.01 | 50 | ||
2018-10-25 | 2018-09-30 | -0.02 | 0.04 | 0.06 | 300 | ||
2018-07-31 | 2018-06-30 | -0.03 | 0.02 | 0.05 | 166 | ||
2018-05-01 | 2018-03-31 | -0.01 | 0.04 | 0.05 | 500 | ||
2018-02-15 | 2017-12-31 | 0.05 | 0.02 | -0.03 | 60 | ||
2017-10-31 | 2017-09-30 | -0.02 | 0.01 | 0.03 | 150 | ||
2017-08-01 | 2017-06-30 | -0.01 | -0.01 | 0.0 | 0 | ||
2017-05-02 | 2017-03-31 | -0.01 | -0.04 | -0.03 | 300 | ||
2017-02-15 | 2016-12-31 | -0.02 | -0.0995 | -0.0795 | 397 | ||
2016-11-02 | 2016-09-30 | -0.03 | -0.02 | 0.01 | 33 | ||
2016-08-03 | 2016-06-30 | -0.01 | -0.04 | -0.03 | 300 | ||
2016-05-04 | 2016-03-31 | -0.01 | -0.01 | 0.0 | 0 | ||
2016-02-17 | 2015-12-31 | -0.01 | -0.01 | 0.0 | 0 | ||
2015-11-04 | 2015-09-30 | -0.01 | -0.03 | -0.02 | 200 | ||
2015-07-30 | 2015-06-30 | -0.01 | -0.03 | -0.02 | 200 |
Use Shopify in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Shopify position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Shopify will appreciate offsetting losses from the drop in the long position's value.Shopify Pair Trading
Shopify Pair Trading Analysis
The ability to find closely correlated positions to Shopify could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Shopify when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Shopify - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Shopify to buy it.
The correlation of Shopify is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Shopify moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Shopify moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Shopify can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Shopify position
In addition to having Shopify in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Alternative Energy Thematic Idea Now
Alternative Energy
Large and mid-size companies, ETFs and funds that are either investing or directly involved in providing energy derived from sources not connected to fossil fuels, do not consume natural resources, and do not harm the environment. This includes wind power, nuclear and solar energy, biofuel, ethanol, hydrogen and others alternative sources of energy. The Alternative Energy theme has 42 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Alternative Energy Theme or any other thematic opportunities.
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Additional Tools for Shopify Stock Analysis
When running Shopify's price analysis, check to measure Shopify's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Shopify is operating at the current time. Most of Shopify's value examination focuses on studying past and present price action to predict the probability of Shopify's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Shopify's price. Additionally, you may evaluate how the addition of Shopify to your portfolios can decrease your overall portfolio volatility.