Down 79%, Shopify Stock Is a Rare Buying Opportunity in a Bear Market
Recession fears have sent the S&P 500 and Nasdaq Composite tumbling into a bear market this year, and both indexes have now posted three consecutive quarterly losses for the first time since 2009. During this current upheaval, Shopify (NYSE: SHOP) saw its share price drop roughly 79%, marking the greatest stock price decline the Canadian e-commerce company has suffered since going public in 2015.
This creates a very rare opportunity for investors. Here's why this growth stock is a smart buy right now.
The bear case for Shopify centers on three points of potential weakness. First, Shopify faces competition from larger retailers like Amazon and Walmart. Second, it currently derives a significant portion of revenue from small and medium-sized businesses, which may be more susceptible to economic downturns. And third, its decision to build the Shopify Fulfillment Network (SFN) will require a considerable amount of money -- management says capital expenditures related to the project will total $1 billion in the next two years -- and that will put pressure on profitability.
Source Fool.com
