Truist Securities has revised down its target price for Shopify to $110.00 from $155.00 while keeping a Hold rating on the shares. The new target sits near Shopify's trading price of $115.23, and the stock has fallen roughly 21% year-to-date, according to InvestingPro data.
The firm attributed the lowered target primarily to what it characterized as "material valuation compression across coverage," even as it acknowledged that Shopify's operational fundamentals remain strong. Truist flagged the elevated price-to-earnings multiple - Shopify trades at a P/E of 85.07 as reported by InvestingPro - noting that this is a high earnings multiple against near-term growth expectations.
On the results front, Truist pointed to Shopify's fourth-quarter performance as evidence of continued business momentum. The company reported gross merchandise volume (GMV) growth of 31% year-over-year, or 29% on a constant currency basis, along with accelerating payments penetration and continuing progress in international and enterprise segments.
Despite those data points, Truist observed that the roughly 9% decline in Shopify's share price after the earnings release "feels disconnected" given the company's asserted AI defensibility and the positive fundamental read-throughs from its results.
Valuation, however, remains central to Truist's reassessment. The analyst house noted that Shopify's valuation "are not as elevated as have been for some time," and highlighted multiples it views as more compelling: approximately 8x enterprise value to 2027 sales and about 17x enterprise value to gross profit. Those figures, Truist said, make the risk/reward profile "more interesting" for what it termed a "premium scaled commerce platform business well positioned to capitalize on agentic commerce."
The earnings release itself showed Shopify beating consensus forecasts for the fourth quarter of 2025. The company reported earnings per share of $0.57 versus an expected $0.51, and revenue of $3.67 billion compared with an anticipated $3.59 billion.
Other analyst activity noted alongside Truist's action included Canaccord Genuity's reduction of its price target on Shopify to $165 from $185, while maintaining a Buy rating. Canaccord said the adjustment reflects concerns about potential AI-driven disruption in the software sector, even as it described "a lot of momentum" for Shopify.
Overall, the juxtaposition of strong quarterly results and downward pressure on valuation underpinned Truist's move to lower its price objective while keeping a cautious stance on the shares.