Shopify (NYSE: SHOP) – Technical Breakout, Long-Term Growth Potential
Shopify (NYSE: SHOP) is shaping up as a high-conviction buy, especially for those willing to stomach short-term volatility in exchange for long-term upside. The stock just triggered a bullish breakout from a well-defined inverse head-and-shoulders pattern—one of the more reliable setups for trend reversals. Volume confirmed the move, with two separate days north of 30 million shares traded (more than double the 12.8M daily average), sparked by a strong earnings report and the surprise announcement that Shopify would be added to the Nasdaq-100.
From a technical perspective, this move above the $100.60 resistance level now flips that level into support, signaling the beginning of what could be a sustained breakout. On the weekly chart, SHOP is trading within a rising channel and appears to be building momentum toward its all-time high of $176.
Under the hood, there’s a lot more going on than just chart patterns. Revenue grew 26.8% year-over-year last quarter, and non-GAAP earnings jumped 25%—evidence that the company is executing well as it matures. Shopify is no longer just for scrappy e-commerce startups. Bigger names like Reebok, Overstock, and Barnes & Noble are coming on board, diversifying and stabilizing the company’s revenue streams.
One note of caution: GAAP earnings showed a loss, driven by a $1.04 billion write-down in unspecified equity investments. That doesn’t reflect operations and shouldn’t be confused with the health of the underlying business.
Valuation remains rich. Non-GAAP EPS is expected to hit $1.41 by 2026, which puts the stock at about 76x forward earnings. GAAP EPS is forecast to dip in 2025 before rebounding in 2026. Shopify will need to continue growing into this multiple, but it has a credible path—expanding enterprise adoption, rolling out new merchant tools, and riding a still-strong wave of e-commerce demand.
We just added SHOP to our Active Opportunities portfolio on Monday. The setup is there, both technically and fundamentally. This is one to watch—and potentially one to own on any near-term dips.
