Investors in the budding e-commerce technology company Shopify Inc. (TSX:SHOP)(NYSE:SHOP) have been well-rewarded over the past year, with shares of Shopify appreciating approximately 180% over that time frame. With a number of significant catalysts taking the company into the stratosphere, the stock has recently sold off, as many investors determined now may be the time to take some money off the table. Shopify’s management seems to disagree, and last week gave investors another reason to hold onto Shopify stock (or perhaps buy some more) – a partnership with e-commerce giant Ebay Inc. (NASDAQ:EBAY).
In addition to closing several massively important partnership deals over the recent quarters with companies such as Amazon.com, Inc. (NASDAQ:AMZN), Facebook Inc. (NASDAQ:FB), Pinterest and Buzzfeed, Shopify has now rounded out its partnership list with another high-end e-commerce platform, further bolstering its market position in a competitive, but profitable merchant services e-commerce industry.
Shopify’s platform allows merchants to sell their goods online, bringing the e-commerce revolution to mom-and-pop stores everywhere. With the e-commerce revolution in full swing, investors are betting that companies such as Shopify will be able to monetize this growth over time and continue to churn out impressive revenue (and eventually profit) numbers over time.
The ability of Shopify merchants to now reach millions of additional buyers on the eBay platform is yet another selling point for merchants to sign on, increasing the attractiveness of Shopify for both merchants and investors. I would anticipate another run up in Shopify stock over the medium-term, and despite sky-high valuations, I continue to believe this company will outperform many of its peers due to its impressive growth profile.
Invest wisely, my friends.