The stock of e-commerce company Shopify (SHOP) has jumped 14% higher as investors cheer the news that the company is being added to the Nasdaq 100 index.
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Nasdaq announced that Shopify will replace U.S. software company MongoDB (MDB) on the index starting on May 19. Shopify’s stock already trades on the Nasdaq Composite index, as well as the Toronto Stock Exchange.
The Nasdaq 100 is a stock market index made up of the 100 largest non-financial companies listed on the technology-laden Nasdaq Composite exchange. Inclusion in the Nasdaq 100 should give Shopify’s stock a boost as mutual funds and exchange-traded funds (ETFs) that track the index’s performance are required to buy the company’s shares.
Strong Print
Shopify recently reported strong quarterly financial results that showed 27% year-over-year revenue growth. Management at Shopify said they have yet to experience a decline due to Canada’s trade conflict with the neighboring U.S.
Earlier this year, Shopify listed a co-headquarters in New York City along with its headquarters in Ottawa, Canada in regulatory fillings, leading to speculation that the company is moving closer to the American market. SHOP stock has risen 1% this year.
Is SHOP Stock a Buy?
The stock of Shopify has a consensus Strong Buy rating among 32 Wall Street analysts. That rating is based on 24 Buy and eight Hold recommendations issued in the past three months. The average SHOP price target of $117.35 implies 9.38% upside from current levels.
