Shopify (SHOP) Reports Strong Earnings Boost
RiverPark Advisors, an investment advisory firm, recently shared insights in its third quarter 2024 investor letter. This quarter, the markets had a strong performance, with the Russell 1000 Growth Index and the S&P 500 index returning 3.19% and 5.89% respectively. RiverPark’s Large Growth Fund also saw positive returns of 3.73%. While the quarter started off rocky due to concerns of a recession caused by a weaker jobs report, the market quickly rebounded with China’s stimulus package and the Fed’s rate cuts.
In their investor letter, RiverPark highlighted Shopify Inc. (NYSE:SHOP), a cloud-based commerce platform company based in Ottawa, Canada. Shopify’s stock has seen impressive growth, with a one-month return of 14.96% and a 52-week gain of 58.43%. As of December 17, 2024, Shopify’s stock closed at $119.49 per share with a market capitalization of $154.71 billion.
RiverPark praised Shopify’s performance in the third quarter, attributing it to a strong second quarter earnings report. The company exceeded revenue growth expectations, saw substantial margin expansion, and achieved impressive gross merchandise value growth of 22%. Shopify’s third quarter revenue stood at $2.2 billion, up 26% year-over-year.
While Shopify is not among the 31 Most Popular Stocks Among Hedge Funds, 56 hedge fund portfolios held shares of the company at the end of the third quarter. RiverPark acknowledges Shopify’s potential as an investment but emphasizes their conviction in AI stocks for higher returns in a shorter time frame.
For investors interested in AI stocks, RiverPark suggests looking into opportunities similar to NVIDIA but trading at a more favorable earnings multiple. For more insights on stock picks for 2024 and hedge fund investor letters, you can explore additional articles on their website.
