Shopify SHOP is growing its presence in the e-commerce domain by offering user-friendly tools and an extensive app marketplace.
According to the Morder Intelligence report, the e-commerce market is projected to be worth $10.19 trillion in 2025. It is expected to reach $21.22 trillion by 2030, with a compound annual growth rate of 15.8% over the 2025-2030 period. Shopify is likely to gain from the massive growth opportunity.
Shopify’s robust growth in its merchant base is driven by its merchant-friendly tools, including Shop Pay, Shopify Pay Instalments, Sign in with Shop and the Shop App. The strong adoption of these solutions holds promise for Shopify’s prospects.
SHOP’s expanding portfolio has been a major growth driver for its success. Its merchant-friendly tool Shop Pay stands out as a key driver. The app processed $22 billion in Gross Merchandise Value in the first quarter of 2025, up 57% year over year. Large brands like Birkenstock, Lilly Pulitzer, and Johnny adopted Shop Pay, enhancing Shopify’s portfolio.
Further expanding its portfolio, Shopify recently partnered with Coinbase and Stripe to enable merchants worldwide to accept USDC stablecoin payments through Shopify Payments. This integration offers fast, borderless transactions on the Base network, with no added fees and seamless checkout experiences.
SHOP Faces Stiff Competition
Shopify is facing stiff competition in the e-commerce marketplace against the likes of Etsy ETSY and BigCommerce BIGC.
BigCommerce is benefiting from its expanding portfolio, particularly with the introduction of Catalyst, enabling businesses to create unique and efficient B2B and B2C e-commerce experiences. BigCommerce also benefits from its AI-powered tools and integrations.
Etsy is benefiting from enhanced personalization through AI, strong mobile app performance, and continued growth in gifting, as well as Depop’s impressive performance.
Etsy is also improving its customer experience through more browsable and personalized shopping experiences, particularly on its mobile app. The app now accounts for 44.5% of total Etsy marketplace Gross Merchandise Sales in the first quarter of 2025, with better buyer conversion rates, more monthly active users, and increased app downloads.
SHOP’s Share Price Performance, Valuation and Estimates
Shopify shares have surged 7.1% year to date, outperforming the broader Zacks Computer & Technology sector’s return of 3.6%. The Zacks Internet Services industry declined 9.3% in the same time frame.
Shopify Stock Performance
Zacks Investment Research
Image Source: Zacks Investment Research
SHOP stock is trading at a premium, with a forward 12-month Price/Sales of 12.47X compared with the industry’s 5.05X. SHOP has a Value Score of F.
Price/Sales (F12M)
Zacks Investment Research
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for second-quarter 2025 earnings is pegged at 28 cents per share, which has remained unchanged over the past 30 days, indicating a 7.69% increase year over year.
Shopify Inc. Price and Consensus
Shopify Inc. Price and Consensus Shopify Inc. price-consensus-chart | Shopify Inc. Quote
The consensus mark for 2025 earnings is pegged at $1.40 per share, unchanged over the past 30 days, suggesting 7.69% year-over-year growth.
SHOP currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Etsy, Inc. (ETSY) : Free Stock Analysis Report
Shopify Inc. (SHOP) : Free Stock Analysis Report
BigCommerce Holdings, Inc. (BIGC) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
