Lyle SteinShopify Inc.SHOP.TOCOMMENTSep 26, 2017

Still some runway. Tarred with the software brush. A proud Canadian all-star. Buy in 3 tranches: here, ~$105, and ~$100 (that would indicate it's getting to the bottom). If you own now, add on weakness as outlined.

Note:  Not in his fund, but in some separately managed accounts.

Right here, right now is a good entry point for a long-term hold. Part of the AI witch-hunt trade. Competitive moat won't be eroded by agentic AI. People don't understand that writing code is not "one and done", not to mention cybersecurity concerns and complex payment systems.

Increasingly catering to larger customers. Continues to innovate and to add value to legacy markets.

Small home-office portion of the economy, which tends to be more volatile. A fundamental issue is that founder owns only a small bit, but wields outsized voting power. Good when it's good, and then really bad.

Everybody hates software now, because apparently AI will replace it. But SHOP was innovative, quick to roll out services to include AI. They are seeing some growth. Is a high-growth company. Doesn't worry much about it. Now is a good buying opportunity. Is a growth stock.

Very volatile. A great company with growth, but the valuation is too high and shares are priced to perfection. That decline just happened after reporting recently. Anything software has been hit by AI fears.

CEO is very focused and hands-on AI. In the future, a lot more commerce will be agentic. Revenue model will shift increasingly to subscription-based. One of the names in the space he likes. Founder led, and the guy knows AI.

Good products and growth. The numbers they reported last week were fine, but future growth is moderating, which the markets doesn't like, consider its high PE. 

Gets painted as sort of a software company, and those are out of favour. Price action is very difficult, and often feels like trying to catch a knife. His price target is ~$205. There are so many other clear opportunities out there than trying to wing it with this one.

Quite volatile. On her watchlist. One of the strongest platforms in the e-commerce space. Total value of goods sold expected to grow 32%. AI already helping merchants attract customers.

Be patient for a favourable entry point to get in.

At its core, it's the software between drop-shippers in China and influencers/users. So it's in the layer that's more at risk over time. If it were cheaper, he'd be more interested.

MSFT is the better pick today.

People think large-language models will eat its lunch, make the e-commerce platform questionable. Many analysts have brought down 12-month price targets. Volatility gives you a chance to earn income by selling puts and calls. 

He loves their business, which has few competitors, but the problem is always their high valuation, even after the current pullback. They have low free cash flow. Too risky. You're playing momentum either way.

Winning the global commerce infrastructure war. Valuation is always the hurdle for investors. Has a real moat and real fundamentals. CEO has an AI-first approach, which helps to expand margins. No dividend.

(Analysts’ price target is $157.00)

Really well managed. Can they anchor themselves in an agentic-commerce world? Making every attempt to do so. But will they succeed? Too soon to know. Market-darling, cult-like stocks facing existential questions usually have valuations compress more. Probably more downside risk.

Tech is struggling and SHOP trades at a high PE. Would be interesting in the $80s. He sees more downside from here.