Shopify Inc (US) (NYSE: SHOP) is one of 29 publicly-traded companies in the “E-commerce & Auction Services” industry, but how does it compare to its rivals? We will compare Shopify Inc (US) to similar businesses based on the strength of its risk, analyst recommendations, valuation, institutional ownership, dividends, earnings and profitability.

Insider & Institutional Ownership

53.8% of Shopify Inc (US) shares are held by institutional investors. Comparatively, 47.7% of shares of all “E-commerce & Auction Services” companies are held by institutional investors. 17.9% of shares of all “E-commerce & Auction Services” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Shopify Inc (US) and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Shopify Inc (US) 1 16 20 0 2.51
Shopify Inc (US) Competitors 114 733 1557 87 2.65

Shopify Inc (US) currently has a consensus price target of $90.73, suggesting a potential downside of 23.89%. As a group, “E-commerce & Auction Services” companies have a potential upside of 8.01%. Given Shopify Inc (US)’s rivals stronger consensus rating and higher possible upside, analysts plainly believe Shopify Inc (US) has less favorable growth aspects than its rivals.

Valuation and Earnings

This table compares Shopify Inc (US) and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Shopify Inc (US) $509.00 million -$34.47 million -233.75
Shopify Inc (US) Competitors $2.64 billion $882.67 million -31.65

Shopify Inc (US)’s rivals have higher revenue and earnings than Shopify Inc (US). Shopify Inc (US) is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Shopify Inc (US) and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Shopify Inc (US) -9.25% -8.11% -7.13%
Shopify Inc (US) Competitors -1,538.30% -32.31% -7.94%

Volatility and Risk

Shopify Inc (US) has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Shopify Inc (US)’s rivals have a beta of 1.53, meaning that their average stock price is 53% more volatile than the S&P 500.

Summary

Shopify Inc (US) rivals beat Shopify Inc (US) on 8 of the 12 factors compared.

About Shopify Inc (US)

Shopify Inc. (Shopify) provides a cloud-based, multi-channel commerce platform designed for small and medium-sized businesses. The Company offers subscription solutions and merchant solutions. The Company’s software is used by merchants to run their business across all of their sales channels, including Web and mobile storefronts, physical retail locations, social media storefronts and marketplaces. The Shopify platform provides merchants with a single view of their business and customers across all of their sales channels and enables them to manage products and inventory, process orders and payments, ship orders, build customer relationships and leverage analytics and reporting all from one integrated back office. The Shopify platform includes a mobile-optimized checkout system, which is designed to enable merchants’ consumers to buy products over mobile Websites. Its merchants are able to offer their customers the ability to check out by using Apple Pay.

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