RBC Capital on Tuesday lowered its price objective for Shopify (NASDAQ:SHOP) to $170.00 from $200.00 while keeping an Outperform rating on the e-commerce platform provider. The firm framed its action against a backdrop of strong operating results and a set of balance-sheet and market sentiment considerations.
Shopify's shares are trading at $118.71, down from a prior close of $127.24, representing a year-to-date decline of 26.25% as of the latest quote cited by RBC. The broker described the company's most recent quarter as a "fundamentally strong quarter," even though it flagged some issues around free cash flow and tax items.
On the top line, Shopify's fourth-quarter revenue exceeded consensus estimates by 2.2%. That outperformance complements the platform's 30.14% revenue growth over the trailing twelve months, taking annual revenue to $11.56 billion.
RBC highlighted Shopify's guidance for the first quarter, noting that management's outlook implies revenue growth accelerating to a four-year high and outpacing analyst consensus. The firm views that trajectory as a positive data point, even as it trimmed its valuation target.
The broker also observed that Shopify shares appear to be influenced by what it called "broader AI disruption fears" in the market. Despite those investor concerns, RBC said the company is "likely to be an AI beneficiary" over the long term and suggested that continued growth combined with AI traction could help stabilize the company's valuation.
Independent platform metrics referenced by market research tools give Shopify high marks on balance-sheet and operating metrics. In particular, InvestingPro assigns Shopify a "GREAT" overall financial health score, with especially strong ratings for growth and profitability.
Analyst reactions and peer moves
Other brokerages have responded to Shopify's recent results with a range of rating and target adjustments, reflecting differing views on valuation versus momentum:
- Citizens reduced its price target to $160 while maintaining a Market Outperform rating.
- Mizuho upgraded Shopify to Outperform, citing what it called superb execution and strong momentum.
- Stifel cut its target to $115 and kept a Hold rating after acknowledging strong performance and an upbeat top-line outlook driven by enterprise and international expansion.
- DA Davidson reiterated a Buy rating with a $195 target, pointing to 31% year-over-year growth in 2025 and management's expectation for more than 30% growth in the first quarter of 2026.
- Truist Securities lowered its price target to $110, calling out valuation concerns while still recognizing strong underlying business fundamentals.
These moves illustrate a split among analysts between those focused on execution and near-term growth momentum and those emphasizing valuation constraints amid heightened market uncertainty.
Recent operating detail
Shopify reported solid fourth-quarter 2025 results that included gross merchandise volume expanding 29% year-over-year on an ex-foreign-exchange basis. Management commentary and guidance have prompted both upward and downward reactions across the sell-side, producing a wide range of price targets and ratings.
What this means for investors
RBC's decision to lower the price target while keeping an Outperform rating underscores a view that the company retains durable growth characteristics and potential upside from AI, but that valuation and cash-flow clarity remain considerations for near-term price discovery. The divergence among other brokers suggests that investor attention will remain focused on execution, margin and cash-flow trends as well as how market narratives around AI affect multiples.