What's Going On With Shopify Stock?

Shopify Inc SHOP shares are volatile Thursday on the heels of the company's second-quarter financial results. Multiple analysts raised price targets following the print. 

What Happened: Shopify said second-quarter revenue increased 31% year-over-year to $1.69 billion, which beat the consensus estimate of $1.62 billion. The e-commerce platform company reported adjusted quarterly earnings of 14 cents per share, which beat analyst estimates of 6 cents per share.

Gross merchandise volume increased 17% year-over-year to $55 billion. Gross payments volume came in at $31.7 billion. Merchant solutions revenue increased 35% year-over-year. 

Free cash flow totaled $97 million in the second quarter compared to negative free cash flow of $87 million in the same quarter last year. 

“Our business momentum has led to another quarter of strong financial results. We’re not just shipping products faster, but we are also expanding our global merchant base, all while improving our ability to generate greater free cash flow,” said Harley Finkelstein, president of Shopify. 

Shopify said it expects third-quarter revenue to grow at a low-twenties percentage rate on a year-over-year basis. Gross margin is expected to be 2% or 3% higher than the second quarter gross margin of 49.3%. 

The company also said it expects free cash flow profitability in the third quarter to be greater than the entire first half of 2023. 

Following the company's quarterly results, Piper Sandler analyst Clarke Jeffries maintained Shopify with a Neutral rating and raised the price target from $50 to $58. Barclays analyst Trevor Young maintained an Equal-Weight rating and raised the price target from $50 to $53.

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SHOP Price Action: Shopify shares initially traded higher on the report but finished Wednesday's after-hours session down. The stock continues to be volatile Thursday. It was down 1.81% at $61.25 at the time of publication, according to Benzinga Pro.

Photo: deepak pal from Flickr.