There's a stock lurking in the tech sector that has a hard-to-beat upside potential of 55%. That's the firm belief of one analyst who recently reiterated his enthusiastic buy recommendation on Shopify (SHOP -6.46%). Deutsche Bank's Bhavin Shah feels that the e-commerce facilitator is standing in front of numerous opportunities to expand business.
Talking the talk, and walking the walk
The analyst came away with quite a positive feeling about Shopify following its ShopTalk event last week. He published a new research note reiterating his buy recommendation on the stock, and his price target of $150 per share. In Shah's view, the company has clear opportunities to provide merchants with unified commerce, personalization, and other features allowing them to sharpen their competitive edges.
Moreover, artificial intelligence (AI) is in high demand with many industries, including e-commerce. Shah wrote in his Shopify note that by helping clients harness AI, the company will help them enhance the general shopper experience, and assist with customer retention.
NASDAQ: SHOP
Key Data Points
This is a stock to add to your shopping basket
Like Shah, I feel Shopify is undervalued, and I'd add that it's generally under-appreciated by investors. It's not a glamorous company since what it offers are the relatively unexciting solutions that underpin e-commerce operations.
To me, that makes it a solid pick-and-shovel play in the extremely long-tail online retailing space. There are countless businesses selling their wares this way, so a company that offers a range of services that can make them more competitive will always be an appealing proposition. I entirely share Shah's bullish view of Shopify.
