Shares of Shopify (NYSE: SHOP) were up by more than 5% in morning trading on Wednesday after the e-commerce company announced that it was hiking prices for all its merchants’ plans including Basic, Shopify, and Advanced.
According to the new prices, SHOP will now charge $39 for the basic plan, $105 for Shopify, and $399 for the Advanced plan. The price raise will take effect from April 23 this year and the hikes across all plans are effectively around 33%.
However, the raised prices are effective immediately for new merchants while existing merchants won’t see a price change for the next three months.
Top-rated Baird analyst Colin Sebastian approved of these price hikes and commented, “We don’t think these prices warrant a change for the vast majority of merchants, given the time and effort required to shift platforms, and our view that Shopify’s platform, in many respects, offers superior e-commerce functionality at a reasonable price.”
The analyst has a Buy rating on SHOP stock with a price target of $45. Sebastian’s price target implies that the stock is priced in at current levels.
Analysts are cautiously optimistic about SHOP stock with a Moderate Buy consensus rating based on nine Buys, 13 Holds, and one Sell.