SHOP Relative Valuation
SHOP's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, SHOP is overvalued; if below, it's undervalued.
Historical Valuation
Shopify Inc (SHOP) is now in the Fair zone, suggesting that its current forward PS ratio of 139.93 is considered Fairly compared with the five-year average of -37.92. The fair price of Shopify Inc (SHOP) is between to according to relative valuation methord.
Relative Value
Fair Zone
-
Current Price：140.41
Fair
84.10
PE
1Y
3Y
5Y
Trailing
Forward
75.76
EV/EBITDA
Shopify Inc. (SHOP) has a current EV/EBITDA of 75.76. The 5-year average EV/EBITDA is 11.57. The thresholds are as follows: Strongly Undervalued below -961.33, Undervalued between -961.33 and -474.88, Fairly Valued between 498.02 and -474.88, Overvalued between 498.02 and 984.47, and Strongly Overvalued above 984.47. The current Forward EV/EBITDA of 75.76 falls within the Historic Trend Line -Fairly Valued range.
76.56
EV/EBIT
Shopify Inc. (SHOP) has a current EV/EBIT of 76.56. The 5-year average EV/EBIT is 95.09. The thresholds are as follows: Strongly Undervalued below -613.62, Undervalued between -613.62 and -259.26, Fairly Valued between 449.45 and -259.26, Overvalued between 449.45 and 803.80, and Strongly Overvalued above 803.80. The current Forward EV/EBIT of 76.56 falls within the Historic Trend Line -Fairly Valued range.
139.93
PS
Shopify Inc. (SHOP) has a current PS of 139.93. The 5-year average PS is 17.82. The thresholds are as follows: Strongly Undervalued below -18.80, Undervalued between -18.80 and -0.49, Fairly Valued between 36.13 and -0.49, Overvalued between 36.13 and 54.45, and Strongly Overvalued above 54.45. The current Forward PS of 139.93 falls within the Strongly Overvalued range.
76.48
P/OCF
Shopify Inc. (SHOP) has a current P/OCF of 76.48. The 5-year average P/OCF is 84.99. The thresholds are as follows: Strongly Undervalued below -296.73, Undervalued between -296.73 and -105.87, Fairly Valued between 275.86 and -105.87, Overvalued between 275.86 and 466.72, and Strongly Overvalued above 466.72. The current Forward P/OCF of 76.48 falls within the Historic Trend Line -Fairly Valued range.
76.05
P/FCF
Shopify Inc. (SHOP) has a current P/FCF of 76.05. The 5-year average P/FCF is 70.08. The thresholds are as follows: Strongly Undervalued below -354.22, Undervalued between -354.22 and -142.07, Fairly Valued between 282.23 and -142.07, Overvalued between 282.23 and 494.37, and Strongly Overvalued above 494.37. The current Forward P/FCF of 76.05 falls within the Historic Trend Line -Fairly Valued range.
Shopify Inc (SHOP) has a current Price-to-Book (P/B) ratio of 14.55. Compared to its 3-year average P/B ratio of 10.77 , the current P/B ratio is approximately 35.12% higher. Relative to its 5-year average P/B ratio of 11.80, the current P/B ratio is about 23.38% higher. Shopify Inc (SHOP) has a Forward Free Cash Flow (FCF) yield of approximately 1.04%. Compared to its 3-year average FCF yield of 0.75%, the current FCF yield is approximately 38.81% lower. Relative to its 5-year average FCF yield of 0.58% , the current FCF yield is about 79.20% lower.
14.55
P/B
Median3y
10.77
Median5y
11.80
1.04
FCF Yield
Median3y
0.75
Median5y
0.58
Competitors Valuation Multiple
The average P/S ratio for SHOP's competitors is 69.70, providing a benchmark for relative valuation. Shopify Inc Corp (SHOP) exhibits a P/S ratio of 139.93, which is 100.76% above the industry average. Given its robust revenue growth of 31.54%, this premium appears sustainable.
P/S
P/E
EV/EBITDA
EV/EBIT
P/S
Revenue Growth
Market Cap
Performance Decomposition
1Y
3Y
5Y
Market capitalization of SHOP increased by 21.05% over the past 1 year. The primary factor behind the change was an increase in P/E Change from 62.46 to 103.24.
The secondary factor is the Revenue Growth, contributed 31.54%to the performance.
Overall, the performance of SHOP in the past 1 year is driven by P/E Change. Which is more unsustainable.
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FAQ
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