The Actual Recommended Trade
** OPTION TRADE: Buy SHOP
APR 01 2021 1100.000 CALLS at approximately $13.00.
The Profit Explained…..
This turned into a two-part trading day for Shopify
1. “Weekly Options Members” entered a trade
on Shopify Friday, March26,
2021 for $14.56, at market opening.
By 10.50am the price of the option had
hit $18.70 – a nice profit of 28%.
(This was based around a note sent to
members at the time of the recommendation -- Watch
the market carefully and keep your trade tight.
2. Re-enter the
trade at 11:14am at a price of $6.00.
Exit the trade at 3:50pm at $16.50 –
175% potential profit.
TOTAL PROFIT FOR THE DAYS TRADING IS 203%
Why The Trade Recommendation On Shopify?
Shopify Inc (NYSE: SHOP), the Canadian e-commerce services
company that helps companies build their own websites, launch marketing
campaigns, process payments, and fulfill orders -- thrived throughout the
pandemic as smaller businesses relied heavily on online orders.
Shopify now serves more than a million businesses worldwide, and its
decentralized self-service platform continues to attract merchants that don't
want to be tethered to Amazon (NASDAQ:AMZN).
Shopify Inc, a commerce company, provides a commerce platform and
services in Canada, the United States, the United Kingdom, Australia, Latin
America, and internationally.
The company's platform provides merchants to run their business in
various sales channels, including web and mobile storefronts, physical retail
locations, pop-up shops, social media storefronts, native mobile apps, buy
buttons, and marketplaces; and enables to manage products and inventory,
process orders and payments, fulfill and ship orders, new buyers and build
customer relationships, source products, leverage analytics and reporting, and
The Major Catalysts for This Trade.....
In the fourth quarter (reported on Feb. 17), Shopify's sales jumped 94%
and the company's earnings popped 267%. That growth was sparked by rising
subscription sales, up 53% year over year, and merchant solutions revenue, up
117% from the year-ago quarter.
People are spending more money than ever on Shopify's platform, as gross
merchandise volume (GMV) exceeded $41 billion and reached $120 billion for
2020. That's up 96% from 2019.
Despite these impressive numbers, Shopify's stock is down about 5% over
the past three months. The slide has occurred as some investors have exited the
tech sector in search of other areas of growth, as the U.S. economy begins to
open back up.
Online sales accounted for just 16% of all retail sales in the U.S. at
the end of 2020, leaving substantial room for more growth in the coming
And with many people now accustomed to buying things online,
particularly after this past year, it's likely that the e-commerce market will
accelerate even faster than it was before COVID-19.
With Shopify's stock taking a slight hit over the past few months, it's
a great time to buy shares of this fast-growing tech stock.
most valuable company, is one of the few e-commerce companies Amazon just can't
seem to beat. Unlike Amazon, which herds third-party merchants into a crowded
marketplace filled with its own first-party goods, Shopify helps businesses
build their own online presences with tools for creating e-commerce sites,
launching marketing campaigns, processing payments, and fulfilling orders.
Amazon recently set up a whole committee just to deal with the “Shopify
According to Josh Rubin of the Toronto Star, Amazon set
up the committee–known as “Project Santos”–to fight Shopify. Reporting by Marketplace
Pulse goes on to say that the top-secret Amazon project aims to replicate
parts of Shopify’s business model.
If that’s true, it should come as no surprise. Shopify has reportedly
been taking business from Amazon, attracting many top vendors to its own
platform. With much lower fees and more creative control, Shopify’s platform
does offer vendors many advantages.
Recently, a number
of top Amazon vendors have moved to Shopify. In most cases, they didn’t stop
selling on Amazon in order to start Shopify stores. However, the fact that
they’re now on Shopify means that Shopify’s share of their sales is increasing.
Some top Amazon vendors getting on the Shopify train include Bulletproof, Hasbro and Penguin
Shopify’s cut of
fees is much lower than Amazon’s, and Amazon has been increasing its cut while
Shopify has kept its cut flat over the years.
Baron Funds, an investment management firm, published its fourth quarter
2020 “Baron FinTech Fund” investor letter, which mentioned Shopify.
Since the beginning of the year, SHOP delivered a 2.65% return,
impressively extending its 12-month gains to 170.23%. As of March 23, 2021, the
stock closed at $1,162.00 per share.
Here is what Baron FinTech Fund has to say about Shopify Inc. in their
Q4 2020 investor letter:
the quarter, we initiated a position in Shopify Inc., a provider of commerce
and payment solutions for merchants of all sizes. Over one million merchants
around the world use Shopify's software to run their businesses through
E-commerce websites and apps, physical retail locations, social media
storefronts, and marketplaces. The Shopify platform addresses many of the
challenges of running a retail business, such as selling across multiple
channels, managing inventory, processing orders and payments, fulfillment,
shipping, and accessing capital. Shopify's solutions operate in the cloud, enabling
faster product innovation and the ability to provide unique data insights to
merchants about demand, pricing. and shipping optimization. The platform
integrates with over 5,000 apps from third-party providers, creating two-sided
network effects as the large number of merchants attract more partners and vice
versa. About half of the company's revenue comes from FinTech solutions,
including processing payments, lending, and business banking services.
Shopify will be a prime beneficiary of the secular growth of Ecommerce. Gross
merchandise volume on the Shopify platform was $100 billion over the last 12
months, which is large but still only 5% of global online sales and 0.5% of
global commerce sales (online and offline) excluding China, implying a very
long runway for growth. We expect Shopify's sales volume to grow faster than
the e-commerce market due to an expanding set of capabilities, geographic
expansion, and a singular focus on helping merchants succeed. We expect Shopify
to better monetize the sales volume on its platform by increasing penetration
of its payments, lending, business banking, and fulfillment services. Shopify's
take rate and operating margin should meaning fully expand over time as the
company provides additional solutions to its merchant customers."
A number of
research analysts have recently issued reports on the stock.....
- National Bank
Financial lifted their target price on shares of Shopify from $1,400.00 to
$1,650.00 and gave the company an “outperform” rating in a research note on
Friday, February 19th.
- Cleveland Research
assumed coverage on shares of Shopify in a research note on Friday, December
4th. They issued a “buy” rating and a $1,206.00 target price for the company.
- KeyCorp lifted their
target price on shares of Shopify from $1,350.00 to $1,650.00 and gave the
company an “overweight” rating in a research note on Wednesday, February 17th.
- Finally, Truist
boosted their price objective on shares of Shopify from $1,100.00 to $1,475.00
in a research report on Thursday, February 18th.
analyst has rated the stock with a sell rating, fifteen have given a hold
rating and fourteen have assigned a buy rating to the stock. The company has a
consensus rating of “Hold” and an average target price of $1,282.23.
Admittedly, it's not likely that Shopify's stock will rise another 185%
as it did in 2020, but it's likely that the tech stock will easily outpace the
S&P 500's returns. That's because Shopify isn't finished tapping into the
fast-growing e-commerce market.
Consider that at the end of 2020 online sales accounted for just 16% of
all retail sales in the U.S. That still leaves a lot of room for Shopify to
expand its platform as more businesses shift to online sales in the coming
In short, e-commerce is still in its early stages, Shopify is in a
leading position, and the company's stock is currently down from its recent