(Bloomberg) – A fierce rally in Shopify Inc. has brought the e-commerce retailer to the third largest company in Canada – highlighting the value of the virtual world in the age of coronavirus.
Shopify climbed up to 10% to reach a record Friday after chief technology officer Jean-Michel Lemieux said in a tweet that the Ottawa-based company treats “traffic on a Black Friday level every day!” because it puts “thousands” of companies online.
This decision extended the seven-day hike to almost 50%, giving it a market value of approximately C $ 92 billion ($ 66 billion) and making it the best performing stock in the world. S & P / TSX composite index so far this year. This has placed Shopify, which provides tools for businesses to sell on the Internet, behind only the Royal Bank of Canada and the Toronto-Dominion Bank as the largest companies in the Canadian stock market.
After downgrading the stock earlier this month, Raymond James analyst Brian Peterson said he was “completely wrong” because Shopify’s stock has become “parabolic” since then.
“What we felt was missing from this dynamic was the speed with which COVID-19 can push new merchants to the Shopify platform,” he said in a report released on Friday. “Many companies needed to establish a presence in e-commerce, and SHOP was the main beneficiary.” It has a market performance rating on Shopify.
Investors now see more value in Shopify than Canadian companies that have existed for decades: Brookfield Asset Management Inc. with billions of dollars of real estate, infrastructure and renewable energy around the world, as well as the giant Enbridge Inc., Canadian National Railway Co. and Bank of Nova Scotia pipelines.
With an increasing number of consumers moving online, Shopify is getting ahead as the value of shopping malls and office towers is questioned, even in a post-viral world.
(Updates to include Raymond James’ comments on Shopify in the fourth and fifth paragraphs.)
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