Cantor Fitzgerald’s Top Internet Stocks: Best Stocks To Buy According To $13.2 Billion Firm

15. Shopify Inc. (NYSE:SHOP)

Number of Hedge Fund Holders In Q2 2024: 56

Share Price Target Upside: -2%

Cantor’s Rating: Neutral

Cantor’s Share Price Target: $70

Shopify Inc. (NYSE:SHOP) is a Canadian eCommerce company with operations in the US as well. The firm has set itself apart from other retailers, apart from Amazon, through its ability to offer merchants a one stop solution for analytics to generate consumer insights and run their marketing campaigns. Additionally, Shopify Inc. (NYSE:SHOP) has also started to offer payments on its platform, joining a series of retailers and internet companies that offer banking related services when possible (as we alluded to in our introduction). Combined, these value add ons to Shopify Inc. (NYSE:SHOP) allow the business a wide moat that enables it to grow market share and retain merchants as well. However, its business is highly cyclical and is vulnerable to downturns in consumer spending. Consequently, the stock is down 1.76% year to date, with an 18% share drop in May following revenue growth guidance of 19.5% for Q2 which marked a deceleration over previous results. This was based on slower spending in Europe, and Shopify Inc. (NYSE:SHOP) has also been recovering from overspending during the pandemic by tightening the belt lately.

Polen Capital mentioned Shopify Inc. (NYSE:SHOP) in its Q2 2024 investor letter. Here is what the fund said:

“Shopify’s business model combines 1) a mission-critical software business where merchants can run all their business operations from one dashboard and 2) a payments business with a long runway to increase attach rates and grow alongside merchants. Additionally, we believe the business possesses significant optionality to continue attaching existing merchant solutions and adding more merchant services as high-margin cross-sells. With several powerful tailwinds at their back (e-commerce, mobile commerce, social media, digital payments, seamless omnichannel, DTC, cloud software digitization) and a highly scalable business model, we think their growth will likely be stronger for longer than investors expect.”