Calgary Urban Project Society is a non-profit organization dedicated to helping individuals and families in Calgary overcome poverty., Youd be forgiven for thinking this website wasnt an annual report at all, given that it is illustration-filled and sprinkled with animation. That's why cheap and expensive are the biggest curse words. Together with Amazon (AMZN), I believe Shopify is at an outstanding position to capitalize on these trends. Shopifys one-page website for their 2014 annual report hits all the right notes. Please agree to the terms of use to be able to view the model. As per eMarketer, "The global e-commerce TAM is projected to grow to $7.4 trillion by 2025." Before we get going and to cheer you up a bit, let me tell you how I came across the company. And vice versa, a stock can be a 5x EPS, be considered "cheap," fall 90% and still be at the same P/E. Please ensure prior to opening the excel sheet, iterative calculations within the excel workbook environment has been enabled under: File/Options/Formulas/Enable iterative calculations. They are very customer-centric and, as such, the probability of this occurring is marginal. Essentially, an app to easily integrate with any e-commerce, regardless of their tech savviness. Terms of Useand Entrepreneurship is currently at its best.

If youve been on the internet at all in 2015, youve read something about how mobile traffic is still increasing respect the people the annual report is for and give it to them in a format that they want to engage with. Disclosure: I/we have a beneficial long position in the shares of SHOP, HUBS either through stock ownership, options, or other derivatives. Shopify has created a successful community with their App Store and Partner Ecosystem. Again, taking it back to the personal side, in our startup we consider e-commerce as one of our main client segments. This is the result of multiplying their $2,354 in ARPU times 68 million retail businesses globally. In fact, Shopify's Founder and CEO, Tobias Ltke, recently acknowledged the company will be growing at lower rates in 2022: Our financial outlook anticipates revenue growth for the full year 2022 that is lower than the 57% revenue growth achieved in 2021, but still rapid and outpacing the growth of e-commerce. Sometimes people ask me where to invest their savings. (They followed a similar style the year before. Operating, valuation and profitability charts of a young, high growth, technology firm. elements Google Ventures Year in Review site sticks to a monochrome blue colour palette, which lets the simple line illustrations and animated Javascript components do all the talking. If you decide to invest, buy with caution and be prepared to add a lower levels as the sell-off might be far from done. With the above in mind, no matter how wonderful Shopify might be, we must decide what valuation makes sense for the company. Check out this annual report it has no pictures, its 60 pages long, and it outlines every single thing our company did this year! Shopify FY 2021 Earnings Presentation (Investor Relations). Their answer typically includes HubSpot (HUBS), Stripe (STRIP), and you guessed it, Shopify (if they run an online shop, of course). A stock could be at the 100x EPS and go from one to infinity. 471 Clarkson Avenue Building S Brooklyn New York 11203, The following trademarks used herein are owned by McDonald's Corporation and its affiliates; McDonald's, Ronald McDonald House Charities, Ronald McDonald House Charities Logo, RMHC, Ronald McDonald House, Ronald McDonald Family Room, and Ronald McDonald Care Mobile. We are lucky enough to be based in Lanzadera, one of the leading business accelerators in Spain (yes, if my writing didn't tell you already, I'm Spanish). App and theme developers pay a 15% revenue share on earnings after the first $1 million, a threshold that resets annually, down from the previous 20% revenue share on their overall revenue. Then in February, the sell-off accelerated as the market expected e-commerce trends to soften due to COVID-19 recovery. Email us to talk about your next annual report. A minimal colour palette is used to keep things simple and readable, and large illustrative text creates a comfortable distinction between sections. Slower than anticipated sales growth due to deterioration in product perception, leading to higher customer churn. If your brokerage account is well capitalized, you might want to consider selling naked puts to complement your entry point. So, if by any chance you're reading through Shopify articles looking for answers, please consider reading mine and avoiding the pointless comments (this of course excludes well-reasoned and well-written commentary, regardless of their view; that is very welcomed and respected). If you experience any issues with this process, please contact us for further assistance. The financial model itself contains no macros. This is not my opinion, but pure facts. This is why most of these companies' services start at a marginal cost (sometimes for free). No investment comes with an absence of risks. As I said, a 50% drawdown on your investment might feel horrible, but it is way worse to miss a multibagger. Calculation of predicted multiples with respect to the sector and the degree of over/undervaluation relative to the sector. This app could be listed in the Shopify Marketplace. Over time, happy customers sign up for extra functionalities (cross-sell) and/or consume more as their business grows (upsell). Please wait while we load the requested 40-F report or click the link below: https://last10k.com/sec-filings/report/1594805/000159480522000011/exhibit11annualinformation.htm. I am not receiving compensation for it (other than from Seeking Alpha). The workbook contains a Macro in the form of the product Disclaimer which should be accepted by the user; hence, please enable macros in the workbook. I am not receiving compensation for it (other than from Seeking Alpha). document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); document.getElementById( "ak_js_2" ).setAttribute( "value", ( new Date() ).getTime() ); I agree to receive Kick Points weekly newsletter containing industry news and company updates. Conversely, clients will consider Shopify because of its outstanding offerings. Option valuation of outstanding options for a young company that compensates employees through options. With or without COVID-19, Shopify will continue to grow and eventually exhibit "normal" growth rates, comparable to those of more mature software companies such as Salesforce (CRM) and ServiceNow (NOW). A 3-statement financial model of a high growth, technology company operation including: revenue schedule, cost schedule, working capital schedule, depreciation and amortization schedule, tax schedule, debt and interest schedule, shareholders equity schedule, covenants and credit statistics spanning across earnings quality, cash flow quality, operating efficiency, balance sheet quality and valuation risk metrics, income statement, cash flow statement and balance sheet for a ten year forecast period. Total Addressable Market (Investor Relations). If assigned, your net entry would be $617 ((650 + (600-16))/2). Perhaps you were not expecting this one. I Privacy Policy ITerms & Conditions IDisclaimer. You must click the activation link in order to complete your subscription. Global e-commerce TAM is projected to grow to $7.4 trillion by 2025. Do your own research and consider becoming a long-term beneficial owner of an outstanding business at a fair price. After submitting your request, you will receive an activation email to the requested email address. High switching costs and strong network effects provide Shopify with a wide and deep economic moat. Needless to say, starting an e-commerce business is something considered by many. aesthetically-pleasing visual elements (illustrations, photos, lettering etc. appears in the Model and the results, toggle the circularity switch on the Assumptions tab to ON and then OFF to address the problem. Everyone loves PDFs! Of course, many of these entrepreneurial projects and small businesses will fail, but others will emerge. I understand that I can withdraw my consent at any time. This switch sets all interest expenses to zero when turned ON. Just in the U.S., e-commerce represents a huge market: US eCommerce Sales (Author's work using data from eMarketer). In case of the existence of data tables in the models, press F9 to refresh and update the table calculations. To opt-in for investor email alerts, please enter your email address in the field below and select at least one alert option. At the time of writing, Shopify trades at $650 (or 16.5x EV/sales). By providing your email address below, you are providing consent to WeCommerce to send you the requested Investor Email Alert updates.

I have no business relationship with any company whose stock is mentioned in this article. As one of Shopifys first partners since 2010, WeCommerce is focused on building, acquiring and investing in leading technology businesses operating in the Shopify partner ecosystem. Consequently, many consider entrepreneurship a real alternative to "traditional" career paths. With all that in mind, I rate the stock a buy. If at any point #Value! Shopify fell in December and January together with its SaaS peers due to high valuation and inflation fears. I wrote this article myself, and it expresses my own opinions. To provide a recent success story related to Shopify App Store, we can look at Returnly, a leader in online return experiences and post-purchase payments. ), UStream is a do-it-yourself site that lets you be a broadcaster.. Obviously Shopify has been one of the main beneficiaries from COVID-19. If the text above sent chills down your spine and made your eyes glaze over, then welcome to the club. Use tab to navigate through the menu items. Sales growth accelerated to almost triple-digit numbers and hence the sales multiple skyrocketed. It is widely known how difficult it is to migrate a preexisting online store from one platform to another. If not assigned, at least you keep the stock position and the option premium for a net entry of $634 (650-16). Scrolling downwards animates certain actions and displays of information in a compelling way, and in case the scrolling gets a little too much for you, theres a fixed nav at the bottom of the screen to help you out. If you never had to go through this painful process, perhaps you can compare it to the complexity of moving your client data to another CRM provider, changing your accounting software or migrating your cloud infrastructure. Returnly was acquired by Affirm (AFRM) in 2021 for an amount close to $300 million in cash and AFRM shares: Returnly serves more than 1,800 merchants, has helped process more than $1 billion in returns, and has been used by over eight million shoppers. Our portfolio of companies and brands today include Pixel Union, Out of the Sandbox, Archetype, Yopify, SuppleApps, Rehash, Foursixty and Stamped. Use of this site is subject to, and your continued use constitutes your express agreement to be Please ensure the above steps are implemented prior to opening the excel sheet. An increase of 3% in shares outstanding (per year). Any unauthorized use of this site is strictly prohibited. Sales multiple compression due to increased tensions in the Ukraine-Russian conflict. Additional disclosure: None of the above constitutes investment advice, just my humble opinion and thoughts. You can sign up for additional alert options at any time. There, we see many startups and have the opportunity to exchange experiences with other entrepreneurs. We consider our merchants' success to be one of the most powerful drivers of our business model. Matching Gift DOUBLES Your Impact. The deviation of the share price on Summary tab from the 2020Q1 PDF note is due to the publication time during the trading day and market volatility.

Can it go lower? 52-109F2 - Certification of interim filings - CFO (E), 52-109F2 - Certification of interim filings - CEO (E), Interim financial statements/report - English, Other securityholders documents - English, Management information circular - English, Notice of the meeting and record date - English, 52-109F1 - Certification of annual filings - CFO (E), 52-109F1 - Certification of annual filings - CEO (E), AB Form 13-501F1 (Class 1 and 3B Reporting Issuers - Participation Fee), Audited annual financial statements - English, ON Form 13-502F1 (Class 1 and 3B Reporting Issuers - Participation Fee), Decision Document (First Amendment to Final), Amendment to (or amended) final short form prospectus - English, Other material contracts (amended) - English, Consent letter of underwriters' legal counsel, Prospectus (non pricing) supplement (other than ATM) - English, Underwriting or agency agreements (or amendment thereto), Draft shelf prospectus supplement - English, Documents affecting rights of securityholders - Trust indentures re debt, Non-issuer's submission to jurisdiction and appointment of agent, Undertaking re novel derivatives or asset-backed securities, Undertaking to file documents and material contracts, Preliminary short form prospectus - English, Prospectus (non pricing) supplement - English, ON Form 13-502F1 (Class 1 Reporting Issuers - Participation Fee), 52-109F2-IPO/RTO - IPO/RTO/ Becoming Non-venture issuer - CFO (E), 52-109F2-IPO/RTO - IPO/RTO/ Becoming Non-venture issuer - CEO (E), NI 44-101 Notice of intent to qualify - English, Supplemented long form PREP prospectus - English, Supplemented long form PREP prospectus - French, Documents affecting rights of securityholders (or amendment thereto), Decision Document (Amendment to Preliminary), Amendment to (or amended) preliminary long form prospectus - English, Amendment to (or amended) preliminary long form prospectus - French, Preliminary long form prospectus - French, Preliminary long form prospectus - English.

To calculate my five-year base case price target, I am using a simple multiples valuation method with the following assumptions: Therefore, my base case five-year target for Shopify is around $2,718, representing an upside of 313% and an IRR of 32.8% if reached by 2026 (at the time of writing, Shopify traded at $657.9). Please let me know what you think in the comment section below. Doubtful. Mail Chimp have been doing online annual reports for years, and their 2012 one is a stand-out. I/we have a beneficial long position in the shares of SHOP, HUBS either through stock ownership, options, or other derivatives. Ill go fire up the Xerox.). If you have an ad-blocker enabled you may be blocked from proceeding. Historical financial statements for a period of six years, company specific operating metrics, covenants and credit statistics including earnings quality, cash flow quality, operating efficiency, balance sheet quality and valuation risk metrics. Sales multiple of 15x (in line with pre-pandemic average levels). ", Shopify Payments & Capital (Investor Relations). Quantification of risk measures for purposes of valuation including beta, cost of equity and cost of capital.

And if this was not enough, the geopolitical tensions between the NATO and Russia added selling pressure, causing stocks and other "risk on" assets to fall as a whole. Over time, Shopify has introduced new offerings. In fact, as Shopify outlines, only the SMB segment represents $160 billion in 2021. A top-fixed navigation bar also gives quick access to each section of the page. They either dislike their day-to-day or simply struggle to find the right opportunity. Thankfully, many companies have done away with this uninspired presentation of information, choosing more creative ways of displaying their annual reports enticing more people to actually read them and absorb some valuable data. Just because a printed and stapled booklet has been the go-to for annual reports for years, doesnt mean we cant do better.

We operate in three segments Apps, Themes and Agency which together offer a suite of solutions that support Shopify merchants. High switching costs and strong network effects provide Shopify a wide and deep economic moat. This multiple also happens to be in line with average pre-pandemic levels for Shopify. Please. Valuation of a young, high growth technology firm based on the intrinsic value approach given the excess growth period. The data displayed in simple graphs, infographics, and large numbers is easy to absorb, and the rollover animations on some of the icons are a nice touch. Here I state some risks that could potentially harm your investment: I strongly believe all fears associated to high inflation and the Ukraine are already priced in. EIN: 13-2933654, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/RMHNY2019Report.pdf?v=1602981107, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2018_RMHNY_Annua_Report_digital.pdf?v=1602981106, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2017_AnnualReport_RMHNY.pdf?v=1602980680, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2017Spring_ATH-1.pdf?v=1602981289, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2015-RMHNY-Annual-Report.pdf?v=1602980654, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2014_Annual_Report-FINAL.pdf?v=1602980648, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2013-Annual-Report.pdf?v=1602980625, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2012-Annual-Report.pdf?v=1602980616, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/2011-Annual-Report.pdf?v=1602980613, https://cdn.shopify.com/s/files/1/0279/5926/3307/files/Annual_Report_2020.pdf?v=1630346408. This financial model is a circular, 3-statement model along with many other features explained in the product description. One way or another, Shopify will continue to help entrepreneurs and thrive in the SMB segment. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. I wrote this article myself, and it expresses my own opinions. The tabs of the models are: Cover, Summary, Assumptions, Annual, Historicals, Model, Valuation, Beta, Forward Multiples, Historical Multiples, Predicted Multiples and Notes. When I first looked at the stock, it traded around $100 per share (or 15x EV/sales). Starting as low as $29 per month, Shopify enables anyone to create a minimum viable product (as per Eric Ries' book The Lean Startup) for their online store. Privacy Statement. Bonus points for the Easter egg: when you scroll up, the fish you caught as you scrolled down gets eaten by a bigger fish! Sensitivity analysis of intrinsic valuation with respect to key revenue drivers and assumptions. Remember that stock prices move for fundamental reasons. With that, here I present you with five reasons why you should consider adding to your Shopify investment (at least, don't sell any shares).

If you are long Shopify and bought near the top, believe me, I feel your pain. XBRL Voluntary Filing Program We can combine design and data to create a compelling website that people will actually want to read. An additional comfort sign is the fact that Shopify's client portfolio is very well diversified, not only merchants belong to different retail verticals, but they come in different sizes. App developers and partners work with Shopify because they have an amazing and growing client base. Google Ventures is the corporate venture capital investment arm of Google Inc. and provides seed, venture, and growth stage funding to technology companies.. You get the point - network effects are difficult to create, but unstoppable when successful. To further prove my point, please read the following quote from SHOP's annual report (linked to above): To attract the best developers in the world, in 2021, Shopify changed its revenue share model with app and theme developer partners to offer a zero percent revenue share on the first million dollars that they make annually on the Shopify App Store.

A two-column design that lets the data scroll on the right, combined with a fade-in background colour change (depending on what section youre in) makes for a pretty good visual experience. you are long Shopify and bought near the top, believe me, I feel your pain. Returnly has a plug and play integration for Shopify. I keep seeing bearish comments about Shopify (NYSE:SHOP) and other SaaS-related articles on Seeking Alpha. Copyright 2018 - 2022, Modelyze Investments Inc. All Rights Reserved. The initiation report as well as 2020Q1 equity research note are included with the package. Ustream knocked it out of the park with their look back on 2013 parallax scroll, animations, animated numbers, full-width images you name it, its here.

The sales multiple is unchanged, but the stock is up 3.5x since 2019. However, we must be fair and acknowledge that the company was at high growth before the 2020. BT utilized videos, infographics, and images to share their findings and incorporated horizontal scrolling and expandable/collapsible features to include extra content but not take up more vertical space than necessary at any one given time. The market opportunity is significant and there is still plenty of growth ahead. All blue font in the model are hardcoded inputs, black font is calculation, red font is the references to the blue inputs on the Assumptions tab, and any orange cells are values sourced from Refinitiv. Includes Ownership Percent, Buy versus Sell comparison, Put-Call ratio and more, Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports, Consolidated Balance Sheets (Parenthetical), Consolidated Statements Of Changes In Shareholders' Equity, Consolidated Statements Of Changes In Shareholders' Equity (Parenthetical), Consolidated Statements Of Operations And Comprehensive Income, Accounts Payable And Accrued Liabilities (Tables), Accounts Payable And Accrued Liabilities - Schedule Of Accounts Payable And Accrued Liabilities (Details), Business Acquisitions - Additional Information (Details), Business Acquisitions - Summary Of Assets Acquired And Liabilities Assumed (Details), Cash And Cash Equivalents - Additional Information (Details), Changes In Accumulated Other Comprehensive Income (Loss), Changes In Accumulated Other Comprehensive Income (Loss) (Tables), Changes In Accumulated Other Comprehensive Income (Loss) - Schedule Of Changes In Accumulated Other Comprehensive Income (Loss) (Details), Commitments And Contingencies - Additional Information (Details), Convertible Senior Notes - Additional Information (Details), Convertible Senior Notes - Summary Of Convertible Debt (Details), Convertible Senior Notes - Summary Of Interest Expense (Details), Credit Facility - Additional Information (Details), Deferred Revenue - Additional Information (Details), Deferred Revenue - Changes In Deferred Revenue (Details), Deferred Revenue - Classification Of Deferred Revenue (Details), Equity And Other Investments - Equity And Other Investments (Details), Equity And Other Investments - Narrative (Details), Equity And Other Investments - Schedule Of Adjusted To Equity And Other Investments With Readily Determinable Fair Values (Details), Equity And Other Investments - Schedule Of Adjusted To Equity And Other Investments Without Readily Determinable Fair Values (Details), Financial Instruments - Additional Information (Details), Financial Instruments - Schedule Of Financial Instruments, Measured At Fair Value On A Recurring And Non-Recurring Basis (Details), Goodwill - Additional Information (Details), Goodwill - Carrying Amount Of Goodwill (Details), Income Taxes - Additional Information (Details), Income Taxes - Deferred Income Tax Assets And Liabilities (Details), Income Taxes - Provision For Income Tax Recovery/Expense (Details), Income Taxes - Schedule Of Comprehensive Income Before Income Tax, Domestic And Foreign (Details), Intangible Assets - Additional Information (Details), Intangible Assets - Classification Of Amortization Expense (Details), Intangible Assets - Estimated Future Amortization Expense (Details), Intangible Assets - Schedule Of Intangible Assets (Details), Leases - Additional Information (Details), Leases - Maturities Of Lease Liabilities (Details), Merchant Cash Advances, Loans And Related Receivables, Merchant Cash Advances, Loans And Related Receivables (Tables), Merchant Cash Advances, Loans And Related Receivables - Summary Of Allowance For Credit Losses (Details), Merchant Cash Advances, Loans And Related Receivables - Summary Of Delinquency Status (Details), Merchant Cash Advances, Loans And Related Receivables - Summary Of Mca, Loans And Related Receivables (Details), Net Income Per Share - Reconciliation Of Weighted Average Number Of Shares Outstanding (Details), Other Current Assets - Schedule Of Other Current Assets (Details), Property And Equipment - Narrative (Details), Property And Equipment - Schedule Of Property And Equipment And Classification Of Depreciation (Details), Segment And Geographical Information (Tables), Segment And Geographical Information - Additional Information (Details), Segment And Geographical Information - Long-Lived Assets (Details), Segment And Geographical Information - Revenue (Details), Shareholders' Equity - Additional Information (Details), Shareholders' Equity - Classification Of Stock-Based Compensation (Details), Shareholders' Equity - Fair Value Assumptions Of Stock Options Granted To Employees (Details), Shareholders' Equity - Stock-Based Compensation Additional Information (Details), Shareholders' Equity - Summary Of Stock Option And Rsu Award Activity (Details), Significant Accounting Policies (Policies), Significant Accounting Policies - Accounting Pronouncements Adopted (Details), Significant Accounting Policies - Advertising Costs (Details), Significant Accounting Policies - Earnings Per Share (Details), Significant Accounting Policies - Intangible Assets (Details), Significant Accounting Policies - Merchant Solutions (Details), Significant Accounting Policies - Property And Equipment (Details), Significant Accounting Policies - Schedule Of Differences Between Reported Amount And Reporting Currency Denominated Amount (Details), Significant Accounting Policies - Segment Information (Details), Significant Accounting Policies - Software Development Costs (Details), Trade And Other Receivables - Activity In Allowance Of Doubtful Accounts (Details), Trade And Other Receivables - Schedule Of Trade And Other Receivables (Details), Exhibit 23.1: Consents Of Experts And Counsel, Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification, https://last10k.com/sec-filings/shop/0001594805-22-000011.htm.

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