Mike Vinokur Shopify Inc. SHOP-T DON'T BUY Jan 07, 2025

Never owned it. After it went public, it was growing revenue at 80%, but was unprofitable. He can't value a company losing money. But SHOP Is shifting: revenue growth is falling as margins rise. It trades at 103X PE, which is not good considering their growth rate.

Very volatile. Options are very expensive. Sell puts $165 April for around $5. 

In his momentum mandate. Increasingly catering to large-enterprise customers, not just small and medium players. Lots of admiration for the business model.

Doesn't think it will start a dividend. You actually don't want companies to pay dividends when there are still so many growth opportunities. Investor Day listed 5 areas ripe for growth, problem is market's already pricing this in. Trading ~100x PE, too expensive for him.

Down ~30% from recent highs, but still above 200-day MA, which is also moving higher. Technically, shares still look sound. Pricey at 61x forward PE for 20-25% earnings growth, a PEG ratio of 2.5x. He prefers US names for tech.

The stock has been volatile, as all growth stocks have been recently. We think merchant customers and the company can adapt well enough. However, the consumer spending impact of tariffs remains a variable. Consumer confidence has dropped, and if tariffs induce inflation then business may certainly be negatively impacted overall. Silver linings might be valuation (better of course with the decline) and sentiment (market sentiment is so bad currently any good news could amplify moves). It remains a high Beta stock. Down 11% YTD, it has actually held up better than many others.
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Pullbacks are great opportunities to add. Continues to invest in R&D. Payments is a big growth vector, still available in only a handful of countries. Secular rise in e-commerce still has room to run.

Growth company that hasn't been smashed, despite coming down from highs. Flirting with getting into the NASDAQ 100; if it goes down there, will be a lot more buying. Last quarter earnings were good, subscription revenue up, and executing well. But it's pricey.

Must-own name, but you have to buy it at the right level. Very whippy, use the technicals to buy.

Not ready to buy. Stock's suffered, but still not cheap. Lots of growth is built into the share price. If recession, consumers will stop buying or buy less. He'd prefer AMZN, quite frankly.

Valuation is 61x forward PE with 25% growth, giving a PEG ratio of well over 2x. 200-week MA is trending lower, which is not a fantastic technical sign. Have to watch out for rivals such as AMZN and ETSY. Depends more on small-and mid-sized businesses, which can be affected more by any economic downturn.