Shopify (NYSE:SHOP) shares rose more than 2% pre-market today after Evercore ISI upgraded the company to Outperform from In Line, setting a price target of $75 per share. Shopify shares have fallen 15% year-to-date, but Evercore sees this as a prime opportunity to invest in a top-tier e-commerce platform.
Evercore expressed strong confidence in Shopify’s long-term potential, highlighting its substantial total addressable market of approximately $850 billion, robust competitive position, opportunities in higher market segments, proven record of product innovation, and the potential for significant profitability growth.
Additionally, the analysts noted that recent disappointing operating margin outlooks from the last two earnings reports have led to significant share price and estimate corrections, which they believe have mitigated risks associated with Shopify shares.
The firm also praised Shopify’s strategic decision to focus on social media marketing to boost international growth, considering it both tactically and strategically sound.