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Investing.com - Piper Sandler reiterated an Overweight rating and $165 price target on Shopify stock (NASDAQ:SHOP), citing improvements in advertising models at major platforms as a tailwind for the company’s merchants. The target suggests 34% upside from the current price of $123.47, though the stock has faced headwinds with a 25% decline over the past six months.
The firm views ad model enhancements by Meta and Google as an under-discussed positive factor for Shopify merchants. Higher return on ad spend at large advertising platforms is driving lower customer acquisition costs and helping subsidize direct-to-consumer marketing efficiency through capital investment. The company’s strong fundamentals support this growth trajectory, with revenue surging 30% in the last twelve months and an InvestingPro Financial Health score rated as "GREAT."
The analysis supports the view that recent growth improvements are sustainable. Proprietary cohort analysis and regression work points to further acceleration in first-quarter 2026 gross merchandise volume and gross payment volume growth.
Piper Sandler recently developed proprietary Shopify cohort analysis after assuming coverage and discussing investor feedback. The firm cited this work in maintaining its positive outlook on the company.
Shopify remains Piper Sandler’s top pick in the web builders sector. With earnings scheduled for April 30, investors will soon get updated guidance on whether the advertising tailwinds are translating into sustained momentum.
In other recent news, Shopify has seen several updates from financial analysts regarding its stock performance and future projections. Wells Fargo has lowered its price target for Shopify to $166 from $191 but has maintained an Overweight rating. The firm predicts Shopify’s first-quarter 2026 results will slightly surpass consensus expectations, driven by growth in gross merchandise volume and operating income. Piper Sandler also reiterated an Overweight rating with a $165 price target, highlighting the company’s potential for 29% year-over-year revenue growth by 2027, surpassing the Street’s 24% consensus.
Meanwhile, Citizens has maintained a Market Outperform rating with a $160 price target, noting Shopify’s growing reputation among eCommerce enterprise merchants, despite some product management gaps. Deutsche Bank has reduced its price target to $175 from $195, citing changes in profitability estimates due to tax rate impacts for fiscal years 2026 and 2027, but continues to rate the stock as a Buy. Lastly, Benchmark reaffirmed its Buy rating with a $145 price target, emphasizing Shopify’s focus on investing in its commerce platform over immediate free cash flow generation. These developments reflect varying perspectives on Shopify’s future performance and strategic direction.
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