BMO initiates Shopify with $120 price target amidst tariff challenges

On May 6, 2025, in the United States, BMO Capital Markets released a report regarding Shopify's positioning in the e-commerce sector amidst ongoing tariff pressures. According to the firm, Shopify is better equipped than its competitors to handle the changes in trade policies, which have caused significant fluctuations in the stock markets and general business environment. The report emphasized the company's agility and flexibility, which serve to enhance its competitive edge. This comes in the wake of tariff instabilities caused by decisions made by former President Donald Trump, who implemented heavy tariffs on Chinese goods, notably a severe 145% duty, which has impacted various sectors. Analyst Thanos Moschopoulos noted that while there are risks associated with tariffs in the immediate term, the strengths inherent in Shopify's platform will position the company to gain more market share compared to others in the e-commerce space. Shopify has demonstrated robust growth and operational leverage recently, particularly after shedding its logistics segment in early 2023. Observations made by Moschopoulos indicate that this divestment is a contributing factor to the company's enhanced growth potential moving forward. Furthermore, the report underscored the impact of artificial intelligence on Shopify's operational productivity. The company's strategic initiatives in cost-cutting measures and the expansion of its business-to-business offerings are additional avenues for growth, indicating that Shopify is proactively adapting to the current economic landscape. With 33 out of 48 analysts giving the stock either a buy or a strong buy rating, general sentiment remains positive about Shopify's future performance. The firm’s price target of $120 per share reflects a potential upside of approximately 22% from the stock's value at the close of the previous trading day. This optimism is shared broadly among industry analysts, indicating a consensus that the underlying strength of Shopify's offerings will help it navigate through tariff disruptions effectively and ultimately yield significant returns for its investors.