Jim Cramer recently voiced his optimism on Shopify Inc. SHOP, highlighting the emergence of a compelling technical indicator known as the Golden Cross, signaling positive prospects for the e-commerce behemoth.
For those uninitiated, a Golden Cross manifests when a stock’s short-term moving average surpasses its long-term moving average—a bullish omen heralding potential uptrends.
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In a recent episode of CNBC’s Mad Money, Cramer expressed his confidence in Shopify, stating, “I think Shopify is at a great level to buy. Harvey Finkelstein is doing a terrific job, and the stock should be perfect.”
This vote of confidence aligns with Shopify’s strong performance, with a 20.56% surge in the past month, an 11.26% increase year-to-date, and a remarkable 53.50% climb over the previous year.
Shopify Stock’s Recent Golden Cross
The current stock behavior of Shopify has captured the attention of traders and analysts alike.
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With Shopify’s stock price at $80.86, comfortably above its 50-day simple moving average of $72.34 and its 200-day moving average of $71.82, along with positive signals from its eight-day and 20-day averages, the momentum appears strongly in Shopify’s favor.
Even industry experts are singing praises for Shopify. Goldman Sachs recently upgraded the stock to a Buy, with JPMorgan and BofA also backing the company, highlighting its expansive product range, ease of use, and scalability as significant advantages.
Shopify’s Stellar Q2 Performance
Shopify’s impressive Q2 results speak volumes about why analysts and investors are bullish. Free cash flow surged by a remarkable 240% to $333 million, while revenue saw a 21% year-over-year jump. Despite a slight slowdown in GMV growth, the company still amassed a substantial $67.2 billion in gross merchandise volume.
Anticipating third-quarter revenue growth in the low-to-mid 20% range, Shopify continues to be hailed as a “best of breed” stock. While the forward P/E ratio lingers near 60, the projected EPS growth of 43% validates Shopify’s lofty valuation.
Cramer’s Optimism and the Golden Cross: A Winning Formula for Shopify Stock
Cramer’s optimistic outlook, bolstered by the Golden Cross formation and the company’s robust fundamentals, creates an enticing blend for potential gains.
The confluence of Shopify’s technical position and the resounding confidence from Wall Street positions Shopify as a key player to observe as the year progresses. For investors seeking the next big opportunity, Shopify isn’t just crossing averages—it’s venturing into uncharted territories.
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