Shopify Earnings: Merchants Flocking to Platform in a Strong Quarter With Good Guidance

We are raising our fair value estimate to $80 per share, from $72 previously, for wide-moat Shopify after the firm reported strong results and provided third-quarter guidance that was meaningfully better than our expectations. Our fair value estimate for Canadian shares rises to CAD 110 from CAD 99. Shares are jumping intraday based on these positive results, but we still see upside based mainly on higher near-term growth contained in our new fair value estimate. Unlike the last couple of quarters, management delivered on cost containment and strong margins. We continue to believe that Shopify is well positioned as a leader in e-commerce and has a variety of irons in the fire to sustain durable growth.