what's up guys it's Rob here and today,we need to talk about Shopify or shop,stock because this stock has been so,oversold over the past year it's gotten,down to ridiculous valuations while all,the all the while maintaining incredible,fundamentals of the underlying company,we're going to break down what's,happened with it over the past 52 weeks,just about and I'm going to explain why,I actually just bought some earlier,today because this is such an incredible,company and it also has a pretty cool,mission right they're doing something,pretty cool so Shopify for those of you,who haven't heard of it is a company,that enables small businesses to engage,in e-commerce they also enable large,businesses to engage in e-commerce but,they're essentially an Amazon competitor,they don't directly sell things,themselves online like Amazon but,instead they provide a platform where,people can create their own online,stores and then sell things as a small,business as a large business anyone who,wants can easily create a Shopify store,and start selling stuff I've done it it,takes maybe you know a couple of hours,with the layout they give you to fully,set up the thing if you have the images,and branding that you need then you just,throw it all together and boom you have,an online store so it's a pretty cool,service that they offer and it does,directly compete with Amazon because it,allows individuals to start selling,products on their own websites and,collecting their own revenues rather,than going through Amazon so it is an,alternative to that and a lot of people,don't like the fact that Amazon seems to,be coming a big Monopoly but Shopify is,certainly helping out by helping to,diffuse the e-commerce space and allow,more people to engage in it instead of,it just being one big Monopoly like,Amazon they help with shipping and all,kinds of stuff so really cool business,model I've used them they're very easy,to use and a pretty uh you know,potentially profitable business when,times are good right if you're selling,the right product so with all that said,I'm going to break down what's happened,with their stock price because you can,see it's Fallen dramatically over the,past year as all things have right is we,are in a recession right now and Shopify,stock has suffered quite a bit now over,the past 50-ish weeks just about you can,see we've moved down from highs to lows,down about 83 percent and this is just,going to give you an idea of the,potential gains that could be seen if we,did end up making back some of those,losses if we just got to where we were,at the beginning of 2022 that would be,about a 388 percent gain on Shopify,stock if you bought at its current price,and if we moved back to the all-time,highs which we've fallen from within a,year that would be a 522 percent gain,now I'm not saying that's going to,happen instantly right we are in the,midst of a recession a lot of stocks,have been moving down and be you know,for good reason right the fed's been,really crushing us with these interest,rate hikes but Shopify I believe does,have the potential to rise back to these,numbers within the next couple of years,because they've been experiencing,incredible growth even while we've been,in recession I'm going to break this,down for you we have in 2022 to in the,first half of 2022 they've reported 2.5,billion dollars in Revenue now if you,annualize that number since that's just,the first half assuming they'll do the,same in the second half as they did in,the first half that's about five billion,dollars in Revenue in 2022. now that's,impressive because in 2021 their total,revenue was 4.6 billion dollars so they,actually managed to grow their revenue,in a year when the entire economy when,GDP was shrinking so very impressive,stuff now it's not as impressive as the,growth that they saw going from 2020 to,2021. from those years they saw 57,growth and going from 2021 to 2022 they,only saw about eight percent growth but,eight percent growth for a stock that's,actually instead of growing eight,percent moved down 80 percent is a,really good buying opportunity in my,opinion right I think that when you see,that kind of stuff that's a disparity,between what the price potentially,should be and what the price is,oftentimes induced by fear and a couple,of negative catalysts that we're going,to discuss now before we break into that,I did want to show you that e-commerce,which Shopify mainly engages in is still,a rapidly growing area these are the,total revenue for retail e-commerce,Revenue in the United States 2017 to,2022 with forecasts to 2025 so 2022 it's,looking like we'll have about 875,billion dollars worth of e-commerce,Revenue in the United States that number,is projected to grow to 1 300 billion so,1.3 trillion dollars in 2025 we're,absolutely expecting e-commerce from,retail to explode over the next couple,of years and Shopify is one of the main,enablers of that if you look at the,gross merchandise volume for Shopify in,2021 they had 175 billion so about 20ish,percent of what we saw in uh 2021 was,from Shopify and that's a 40 increase 47,percent increase from 2020 to 2021,another very impressive thing about,Shopify I'll break down real quick their,market cap has fallen dramatically over,the past couple of months as their stock,price has been crushed they're currently,sitting at a 36 billion dollar market,cap now what's really impressive about,that is that they have cash reserves,totaling,7.77 billion dollars so essentially when,you're buying into this company with a,36 billion dollar market cap 7.7 billion,dollars of that you're just buying into,cash so you can almost just wipe off 7.7,billion dollars worth of their market,cap in terms of what their business has,going for it because they've just got,that cash sitting in their accounts and,they can do whatever they want with that,cash obviously they could spend it they,could try to use it to improve the,business do more research and engage in,new retail opportunities but while,you're buying it currently it's looking,like they've got about 7.7 billion,dollars in cash and so that just makes,the stock look even cheaper from a,market cap perspective so especially,regarding the size of this company the,fact that they are commanding 175,billion dollars worth of gross,merchandise volume so basically how much,people were able to sell with their,services in 2021 that's absolutely,massive and we should be seeing that,number grow in 2022 despite the fact,that we're in a recession so really,impressive stuff now if you're worried,that they're just engaged in e-commerce,uh that's mainly what they've been,focusing on in the past but they're also,starting to Target physical retailers,after admitting that they've been overly,aggressive in the e-commerce space,so one of the reasons why they did end,up sinking over the past couple of,months was Unfortunately they saw well,fortunately they saw massive growth,during the pandemic everyone started,moving online shopping online and we,ended up seeing that growth slowed down,but Shopify had made some big bets on,e-commerce they hired a ton of new,employees some of which they ended up,laying off after realizing that those,growth trajectories weren't going to,sustain themselves entirely once again,they were seeing 57 growth over 47,growth year over year and then they saw,eight percent growth about this year,right if we're projecting forward what,they could do for the rest of the year,so there have been some slowdowns,obviously and that has partly led into,the declines that they've seen but I,think that the declines have been,greatly over exaggerated partly because,the fed's been so hawkish and has been,raising interest rates the fact that,we've been in recession and pretty much,every stock has been getting sold off I,think seriously leads into the fact that,this one has been getting sold off quite,dramatically I think that we could see,some real big gains in the near future,future if the overall economy starts to,turn green again if we start to see new,positive developments not just for,Shopify stock which there will surely be,in the future right they're continuing,to grow at a decent rate eight percent,growth in Revenue in a year when we're,in a recession is very impressive and,when we're out of recession I only,expect that number to grow but once the,overall economy starts coming back,that's when we could really see some,good numbers coming out for them again,and uh one thing that I will point out,right it's not the most positive thing,but it is an interesting statistic their,p e ratio their price earnings ratio is,currently at 221 so that is rather high,this is a growth company right they're,they're in some of the earlier stages of,growth they're not becoming uh profit,generating Powerhouse just yet they're,still focusing once again on a bunch of,growth but it's interesting that they,are at the very least profitable that's,something that I like to see when a,company is at least profitable right,they're not overstepping their bounds,they're not taking out debts this is a,bit more conservative than some of those,than some of the more more out there,small small market cap companies that,you might see that are taking out debts,to fuel their research and those can be,a little bit risky but Shopify I have no,doubts that will it will succeed in the,future I don't think it's going anywhere,the fact that they're profitable I have,so much cash on hand as well as the fact,that they've seen so much growth year,over year for so many years in a row and,that the e-commerce page space which is,their main territory is only projected,to grow in the years to come as more,people gain access to the internet as,more people become comfortable shopping,online and there are more delivery,services available for companies and,shipping becomes less of an issue you,don't have to wait so long for items to,get shipped out I would expect this,company to grow massively and I just,want to explain some of the reasons why,I bought into this stock obviously none,of this is financial advice you guys,don't have to follow me if you don't,want to it's just my opinion on putting,out there letting you guys know what I'm,doing buying up some great companies,during this recession that I think are,going to explode in the years to come,when we actually get out of the,recession so I'm buying for the long,term if anyone's interested in more of,this kind of content feel free to,subscribe to the channel and other than,that check out the link in the,description where you can join our free,private stock group where I talk about,this kind of stuff almost every day so,if you guys are interested in that feel,free to check those things out subscribe,other than that guys have a great rest,of your day I'll see you in the next one,bye
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