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Fly News Breaks for May 14, 2019
May 14, 2019 | 07:20 EDT
Morgan Stanley analyst Brian Essex downgraded Shopify to Underweight from Equal Weight, citing his view that the stock is not deserving of the same multiple as high-growth U.S. Software-as-a-Service companies as less than half of Shopify's revenue comes from subscriptions. Most of Shopify's revenue is transaction-based and its mix is shifting increasingly toward transaction-based revenue, said Essex, who adds that he thinks investors are overpaying for Shopify's Merchant Solutions business at the stock's current valuation. Essex raised his price target on Shopify shares to $209 from $173, however, as he changed his valuation framework to sum-of-the-parts from discounted cash flow.
News For SHOP From the Last 2 Days
Jun 25, 2019 | 07:05 EDT
As previously reported, Wedbush analyst Ygal Arounian downgraded Shopify to Neutral from Outperform on valuation, while raising his price target on the shares to $305 from $270. While the analyst continues to like Shopify's positioning, vision, and competitive moat as it builds a strong retail operating system for merchants, he believes shares appropriately reflect the opportunity ahead. Additionally, while Arounian views the announcements at Shopify Unite as further improving and differentiating the platform, the most impactful announcement, Shopify Fulfillment Network, is not expected to generate profits until 2023.
Jun 24, 2019 | 11:33 EDT
Check out today's top analyst calls from around Wall Street, compiled by The Fly. EVERCORE CUTS SPOTIFY... To see the rest of the story go to See Story Here
Jun 24, 2019 | 10:24 EDT
Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Sonoco (SON) downgraded to Sell from Neutral at Goldman Sachs with analyst Brian Maguire citing valuation. 2. Occidental Petroleum (OXY) downgraded to Equal Weight from Overweight at Morgan Stanley with analyst Devin McDermott saying he believes covering the 2020 dividend at current oil prices will require meaningful capital expenditure cuts, even though the Anadarko (APC) deal looks accretive to cash flow. 3. International Paper (IP) downgraded to Equal Weight from Overweight at Stephens with analyst Mark Connelly saying RISI decided to cut the price of containerboard $10 "just three days after investors breathed a sigh of relief on encouraging supply-demand fundamentals." 4. Shopify (SHOP) downgraded to Neutral from Buy at Roth Capital with analyst Darren Aftahi saying he remains positive on its underlying business prospects following the company's Unite conference and investor day but not on the stock's valuation, which has increased in the wake of the event. 5. Spotify (SPOT) downgraded to Underperform from In Line at Evercore ISI with analyst Kevin Rippey saying the recent rally in the stock "reflects an overly optimistic view" on the company's gross margin path and potential label negotiation outcomes. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.
Jun 24, 2019 | 08:35 EDT
DA Davidson analyst Tom Forte raised his price target for Shopify to $400 from $290 after attending the company's Unite partner & developers conference, including its investor-related meeting. In a research note to investors, Forte, who maintains a Buy rating on the stock, says that in addition to its core efforts, its newer initiatives, including fulfillment, international expansion and retail, should enable it to generate a high rate of sales growth for years to come.