Shares of Shopify traded down modestly today on the announcement of "Checkout on Instagram," a feature that will allow users to complete purchases without leaving the app, Jefferies analyst Samad Samana tells investors in a research note. Facebook's (FB) Instagram will charge merchants a selling fee and partner with PayPal (PYPL) for payment processing, the analyst points out. He understands the investor concerns since Shopify partners with Instagram. Samana, however, believes most merchants will continue to rely on their underlying e-commerce platform to complete most online transactions, manage their stores and inventory. Further, merchants succeeding on multiple channels could increase the likelihood of using a platform like Shopify to manage their business, the analyst contends. He points out, though, that if merchants choose to adopt "Checkout on Instagram", PayPal would provide the payment processing for the gross merchandise volume generated on Instagram rather than directing back to a merchant's Shopify store to process the transaction. This could be a headwind for Shopify's Payments revenue growth, says Samana. He keeps a Hold rating on the shares with a $175 price target. The stock closed the trading day down 2%, or $3.68, to $202.09.

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Consensus is $4.75. Estimated non-GAAP amounts for the twelve months ending December 31, 2024 reflect adjustments of approximately $499M, including restructuring charges of $175M in Q1'24 and additional estimated restructuring charges of approximately $70M to $90M in Q2'24.

President and CEO Alex Chriss said: "We delivered a solid set of results in Q1 and I'm encouraged by the progress the team is making against PayPal's go-forward strategy and in strengthening our foundation. 2024 remains a transition year and we are focused on execution - driving our key strategic initiatives, realizing cost savings, and reinvesting appropriately to position the company for consistent, high-quality profitable growth in the future."

PayPal (PYPL) is scheduled to report results of its first fiscal quarter before market open on April 30, with a conference call scheduled for 8:30 am EDT. What to watch... To see the rest of the story go to thefly.com. See Story Here

Monness Crespi raised the firm's price target on PayPal to $88 from $80 and keeps a Buy rating on the shares. The recent run in PayPal shares has reflected the confirmation that transaction margin dollars and EPS guidance provided was conservative considering the new management team's need to build credibility, the analyst tells investors in a research note. The firm thinks CY25 EPS estimates have likely already troughed and believes PayPal is taking the correct steps.

Citi upgraded Shopify to Buy from Neutral with a price target of $105, up from $93. The firm has confidence in Shopify's near-term results following a recent round of conference visits and channel checks, which highlight a more resilient e-commerce backdrop and accelerated share gains up market. Citi's analysis into the company's Merchant Solutions business gives it confidence in Shopify's long-term growth as take-rate expansion accelerates in 2025, fueled by new product and feature adoption "going mainstream." The shares are trading at a discount on growth-adjusted valuation versus its large cap peers, which creates an attractive entry point, the analyst tells investors in a research note.