While Canadian online shopping great Shopify (TSE:SHOP) already had a win on its hands with its Black Friday / Cyber Monday results, it also got a boost from a new analyst upgrade that declared it an “underrated AI play.” That new sent SHOP stock up over 5% on the day.
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Analyst Anthony Chukumba of Loop Capital upgraded Shopify stock from a Hold to a Buy, and bolstered the price target. Originally $110, Loop Capital now has a $140 price target on the stock. So far this year, shares of Shopify are up 46%.
Using AI Technologies
Chukumba said that investors are not appreciating just how much artificial intelligence (AI) is going into Shopify’s operations. Naturally, it is being used as a customer-facing function, helping to improve shopping personalization and item recommendations.
But Shopify is also putting it to use in more back-office functions, including customer service, human resources, and other areas, which is helping Shopify get more done. That opens up better growth opportunities ahead.
A Powerful Thanksgiving Weekend
In other news, Shopify brought in a total of $11.5 billion in sales over the U.S. Thanksgiving holiday weekend. That is a new record and represents a 24% increase from 2023. Not only did over 76 million customers place an order with a Shopify customer during the weekend, but at one point, sales reached a peak of $4.6 million per minute.
Other high points include more than 16,500 merchants made their first sale with Shopify in that period, and the average cart price came in at $109.70 on a constant currency basis. No matter how you slice it, it was a huge weekend for sales online, and Shopify was a major winner.
Is Shopify Stock a Buy, Sell or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SHOP stock based on 17 Buys, 12 Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 72.54% rally in its share price over the past year, the average SHOP price target of C$158.49 per share implies 5.85% downside risk.
