Shares of Shopify (NYSE:SHOP) ticked higher today after SVB MoffettNathanson analyst Michael Morton upgraded the firm from Market Perform to Outperform, suggesting that the recent surge in Shopify’s stock isn’t over yet. Morton’s outlook is based on his expectations of Shopify’s enterprise business soon hitting a significant turning point, an aspect that current consensus estimates aren’t factoring in. “We’re seeing early signs that Shopify is starting to resonate more with enterprise customers, and we expect this trend to continue,” Morton said.
In boosting its price target for Shopify to $76 from $53, SVB MoffettNathanson pointed to preliminary data showing Shopify’s enterprise business gaining traction. This growing traction could counterbalance analysts’ worries about fulfillment issues. Morton’s team also drew attention to Shopify’s recent top-level hires and increasing web traffic to the Shopify Plus login page.
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SHOP stock based on 10 Buys, 16 Holds, and two Sells assigned in the past three months, as indicated by the graphic above. Nevertheless, the average price target of $64.19 per share implies 2.45% downside risk.