1. Shopify Inc. (NYSE:SHOP)
Revenue Growth Rate over Last 12 Months: 24.59%
3 months returns: 51.34%
Number of Hedge Fund Holders: 62
Shopify Inc. (NYSE:SHOP), an e-commerce company, is also on our list of the top 10 hot growth stocks to buy. The company’s stock has risen dramatically in 2023. Shares of the company have returned 36% in the last month, compared to 4.14% for the S&P 500 composite. Shopify Inc. (NYSE:SHOP) recorded revenues of $1.37 billion in the third quarter, a year-over-year increase of +21.6%. EPS of -$0.02 for the same period surpassed expectations by $0.05. Shopify has outperformed consensus earnings per share projections twice in the previous four quarters. During this time, the firm exceeded consensus sales projections twice.
Even if increasing profits are probably the strongest indicator of a company’s financial health, nothing happens in the traditional sense if a business cannot increase sales. For this reason, understanding a company’s potential for revenue growth is essential. On February 15, Shopify Inc. (NYSE:SHOP) is scheduled to release its Q4 FY22 earnings. For Shopify, the average sales forecast of $1.64 billion for the upcoming quarter indicates an increase of +18.9% from the same period last year. In addition, estimates of $5.51 billion and $6.62 billion for the current and following fiscal years show changes of +19.5% and +20.2%.
Based on 9 buy recommendations, 13 hold ratings, and 2 sell ratings, Shopify Inc. (NYSE:SHOP) has a consensus rating of ‘Moderate Buy.’ The company is also getting the attention of the smart money, as 62 hedge funds tracked by Insider Monkey reported owning stakes in the company at the end of the third quarter, up from 60 funds a quarter earlier. ARK Investment Management is the leading shareholder of Shopify Inc. (NYSE:SHOP), with a stake worth over $460.92 billion.
Artisan Partners, an investment management company, mentioned Shopify Inc. (NYSE:SHOP) in its third-quarter 2022 investor letter. Here is what the fund said:
“Shopify Inc. (NYSE:SHOP) is a leading e-commerce platform supporting over 2 million merchants with software, online storefronts and payments technology. Like Uber, Shopify returned to mid-cap territory during Q2 as the company’s profit cycle and share price have faced significant pressure. Earlier this year, the company began a phase of investments to support a range of future growth drivers, including Shopify Plus for larger brands, logistics services, international expansion, point-of-sale payments and social media-based commerce. With high inflation putting pressure on consumer spending, and with e-commerce activity normalizing after a massive pandemic spike, Shopify’s earnings have fallen sharply. While we have outstanding questions about the likelihood of success for the company’s capital-intensive logistics investments, we decided to take advantage of the stock’s >75% YTD decline and initiate a GardenSM position at a deep discount to our PMV estimate. Our thesis is predicated on our belief there is still a long runway for commerce to move online, and Shopify is well-positioned to win share of this market. The company has created an ecosystem of products (payment processing, financing, shipping, customer engagement tools, etc.), partners (TikTok, Google, Meta), sales channels and over 6,000 apps to help its merchants sell online and establish direct relationships with customers.”
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