Shopify (SHOP), mcap=$39.5bn, price $31.27 vs $39.89

– Write-up provides an overview of the recent developments that caused shares to drop from $1,657 to $399.
– The last two earnings releases were disappointing with planned large CAPEX into the fulfillment network as well as a very wide range of revenue growth guidance.
– Moves by $AMZN are encroaching on the company’s business.
– On the positive side, insiders were acquiring a large number of stocks.
– The investment thesis from the previous VIC write-up remains intact and the slow down (after supercharged covid years growth) was expected.

Valuation: With 25% revenue CAGR, 25% EBITDA margins, and 30x PE, the company would be worth $785/share in 5 years.

Exp. gain: +100% to $785 in 5 years. 15% IRR.

Full SHOP write-up (free guest account required):

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