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Shopify (SHOP) stock crashed on May 5 after the e-commerce giant posted a better-than-expected Q1, featuring artificial intelligence (AI)-driven traffic growth, but disappointed investors with its guidance.
Investors are reacting primarily to management’s guidance for revenue to grow at a “high-twenties percentage rate” in the second quarter, which represents a sequential slowdown from 34% in Q1.
Shopify shares are now down about 33% versus the start of this year.
Barchart Holds a Sell Opinion on Shopify Stock
SHOP shares have already been lagging in 2026, but Barchart’s financial data suggests they could tumble further in the months ahead.
Barchart’s opinion on the Canadian multinational currently sits at “80% SELL," based on 13 major technical indicators covering all short-, medium-, and long-term timeframes.
At the time of writing, Shopify is trading decisively below its key moving averages (MAs), while its RSI in the mid-30s suggests a bit more room before the stock hits oversold territory.
Meanwhile, the put-to-call ratio on options contracts expiring July 17 sits at 1.95x, signaling a strong bearish skew — with the lower price at about $88 indicating potential downside of nearly 20% from here.
SHOP Shares Remain Expensive to Own in 2026
SHOP’s operating income nearly doubled to $382 million in the first quarter.
But rising operating expenses and expectations of a continued hit to profitability as lower-margin merchant solutions continue to outpace higher-margin subscription revenue make the stock even less attractive to buy on the post-earnings dip.
Moreover, according to Barchart, insiders have predominantly unloaded Shopify shares over the past 12 months, indicating an alarming lack of confidence among those closest to the company’s operations.
It's also worth mentioning that SHOP, even after its year-to-date decline, is trading for roughly 94x forward earnings currently, which makes it rather expensive to own in 2026.
Wall Street’s Current View on Shopify Inc
Heading into May 5, Wall Street analysts still had a consensus “Strong Buy” rating on SHOP stock, with a mean price target of $160.
However, it’s reasonable to assume that pockets of weakness in Shopify’s Q1 earnings release will make at least some investors downwardly revise their estimates in the days ahead.
This article was created with the support of automated content tools from our partners at Sigma.AI. Together, our financial data and AI solutions help us to deliver more informed market headline analysis to readers faster than ever.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
