Manhattan Associates Insider Sold Shares Worth $754,504, According to a Recent SEC Filing

Shopify SHOP is scheduled to report its third-quarter 2024 results on Nov. 12.

For the to-be-reported quarter, Shopify expects revenue growth at a low to mid-20% range on a year-over-year basis.

The Zacks Consensus Estimate for revenues is currently pegged at $2.11 billion, suggesting growth of 22.96% from the year-ago quarter’s reported figure.

The consensus mark for earnings is pegged at 27 cents per share, which remained unchanged over the past 60 days. This indicates 12.50% growth from the figure reported in the year-ago quarter.

Shopify Inc. Price and EPS Surprise

Shopify Inc. price-eps-surprise | Shopify Inc. Quote

SHOP’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 31.17%.

See the Zacks Earnings Calendar to stay ahead of market-making news.

Let’s see how things might have shaped up prior to the announcement.

SHOP’s Q3 Earnings: Key Factors to Note

Shopify is benefiting from strong growth in its merchant base, a trend to be reflected in third-quarter results. Merchant-friendly tools like Shop Pay, Shopify Payments, Shopify Collective, Shopify Audiences, Shopify Capital and Shop Cash offers are helping it win new merchants amid a challenging economic environment. Shopify’s platform is widely used by small and medium businesses that are suffering from persistent inflation.

Shopify has added support for UPS and managed markets, enabling merchants to offer competitive expedited shipping rates for international customers. Its continued efforts to streamline operations have been attracting both new, smaller merchants and established, large brands to the platform.

The company has been investing in developing the best solutions for modern e-commerce. Product offerings like Shop Pay, Bill Pay, Tax Platform, Collective and the Marketplace Connect app.

Integration of AI through Shopify Magic across products and workflows is helping merchants expand their footprint. Shopify Checkout is helping merchants offer secure and seamless checkout options for customers.

Merchant expansion is expected to have aided Gross Merchandise Volume (GMV) growth in the to-be-reported quarter. In the second quarter of 2024, Shop Pay processed $16 billion in GMV and accounted for 39% of SHOP’s Gross Payments volume (GPV). In the second quarter, GPV grew to $41.1 billion, constituting 61% of GMV processed.

Offline GMV grew 27% year over year, highlighting increased adoption of SHOP’s platforms by larger global merchants with multiple locations. A major milestone in the second quarter was the online and offline launch of multinational brands EVEREVE and MAJOURI in partnership with Shopify, spanning over 130 locations across four regions — a major achievement for the company.

In the second quarter, more than 50% of merchants joining SHOP’s platform came from the non-English-speaking markets, a trend expected to continue gaining momentum in the third quarter.

The Zacks Consensus Estimate for third-quarter GMV is currently pegged at $68 billion, indicating 25.93% year-over-year growth.

The consensus mark for third-quarter Subscription solutions revenues is pegged at $593 million, indicating 28.08% year-over-year growth. The Zacks Consensus Estimate for Merchant Solutions is pegged at $1.51 billion, suggesting 26.04% year-over-year growth.

SHOP Shares Underperform Sector, Industry

SHOP shares have increased 5.2%, underperforming the Zacks Computer & Technology sector’s return of 28.5% and the Zacks Internet Services industry’s appreciation of 19.8%.

Year-to-Date Performance Chart

Shopify Trading at a Premium

The Value Style Score of F suggests a stretched valuation for Shopify at this moment.

SHOP stock is trading at a premium with a forward 12-month Price/Sales of 10.5x compared with the industry’s 5.03x.

Price/Sales Ratio (F12M)

SHOP Stock to Ride Higher on Strong Merchant Base

Shopify’s long-term prospects are strong, given its growing merchant base and an expanding partner base. Its strategy of adding features and updates frequently — 400 in the past couple of years — has been the key catalyst. SHOP has added more than 150 new product updates and features in the second quarter of 2024.

An expanding partner base that includes TikTok, Snap, Pinterest, Criteo, IBM, Cognizant, Amazon AMZN, Target, Manhattan Associates MANH, COACH and Adyen is expected to expand its merchant base further. Exiting the second quarter, Shopify has also secured a new partnership with Oracle ORCL.

Shopify’s strategy to focus on the core business by divesting the logistics business is a noteworthy development. Its partnership with Amazon allows Shopify merchants to use the former’s massive fulfillment network. The relationship with Target also strengthens SHOP’s footprint.

The partnership with Avalara now helps Shopify merchants of any size to easily manage and automate global tax compliance. The collaboration with Manhattan helps it offer world-class unified omnichannel shopping experiences for consumers.

Shopify’s expanding international footprint is noteworthy. In the first quarter, it launched point-of-sale go and point-of-sale terminal in Australia. Expanding the availability of the Markets Pro into international markets is a game changer. In the second-quarter 2024, 14% of SHOP’s GMV was contributed by cross-border sales.

Conclusion

Shopify is benefiting from strong growth in its merchant base. The expansion of back-office merchant solutions to more countries is strengthening SHOP’s international footprint.

Although the current valuation is stretched, the long-term growth prospects are hard to ignore.

Shopify currently sports a Zacks Rank #1 (Strong Buy) and a Growth Score of B, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment Research

Investors interested in Computer and Technology stocks should always be looking to find the best-performing companies in the group. Dell Technologies (DELL) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Computer and Technology peers, we might be able to answer that question.

Dell Technologies is one of 620 individual stocks in the Computer and Technology sector. Collectively, these companies sit at #5 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.

The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Dell Technologies is currently sporting a Zacks Rank of #2 (Buy).

Over the past three months, the Zacks Consensus Estimate for DELL's full-year earnings has moved 0.9% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.

Based on the most recent data, DELL has returned 57.7% so far this year. Meanwhile, the Computer and Technology sector has returned an average of 27.3% on a year-to-date basis. This means that Dell Technologies is outperforming the sector as a whole this year.

One other Computer and Technology stock that has outperformed the sector so far this year is Manhattan Associates (MANH). The stock is up 27.9% year-to-date.

For Manhattan Associates, the consensus EPS estimate for the current year has increased 13% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Dell Technologies belongs to the Computer - Micro Computers industry, a group that includes 4 individual stocks and currently sits at #207 in the Zacks Industry Rank. On average, this group has gained an average of 22% so far this year, meaning that DELL is performing better in terms of year-to-date returns.

In contrast, Manhattan Associates falls under the Computer - Software industry. Currently, this industry has 33 stocks and is ranked #89. Since the beginning of the year, the industry has moved +14.9%.

Going forward, investors interested in Computer and Technology stocks should continue to pay close attention to Dell Technologies and Manhattan Associates as they could maintain their solid performance.

Zacks Investment Research

Growth investors focus on stocks that are seeing above-average financial growth, as this feature helps these securities garner the market's attention and deliver solid returns. But finding a great growth stock is not easy at all.

By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.

However, the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects, makes it pretty easy to find cutting-edge growth stocks.

Manhattan Associates (MANH) is on the list of such stocks currently recommended by our proprietary system. In addition to a favorable Growth Score, it carries a top Zacks Rank.

Research shows that stocks carrying the best growth features consistently beat the market. And for stocks that have a combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), returns are even better.

Here are three of the most important factors that make the stock of this business software company a great growth pick right now.

Earnings Growth

Earnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. And for growth investors, double-digit earnings growth is definitely preferable, and often an indication of strong prospects (and stock price gains) for the company under consideration.

While the historical EPS growth rate for Manhattan Associates is 25.4%, investors should actually focus on the projected growth. The company's EPS is expected to grow 23.3% this year, crushing the industry average, which calls for EPS growth of 13.7%.

Impressive Asset Utilization Ratio

Growth investors often overlook asset utilization ratio, also known as sales-to-total-assets (S/TA) ratio, but it is an important feature of a real growth stock. This metric exhibits how efficiently a firm is utilizing its assets to generate sales.

Right now, Manhattan Associates has an S/TA ratio of 1.51, which means that the company gets $1.51 in sales for each dollar in assets. Comparing this to the industry average of 0.46, it can be said that the company is more efficient.

In addition to efficiency in generating sales, sales growth plays an important role. And Manhattan Associates looks attractive from a sales growth perspective as well. The company's sales are expected to grow 12% this year versus the industry average of 6.8%.

Promising Earnings Estimate Revisions

Beyond the metrics outlined above, investors should consider the trend in earnings estimate revisions. A positive trend is a plus here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

The current-year earnings estimates for Manhattan Associates have been revising upward. The Zacks Consensus Estimate for the current year has surged 13% over the past month.

Bottom Line

Manhattan Associates has not only earned a Growth Score of B based on a number of factors, including the ones discussed above, but it also carries a Zacks Rank #2 because of the positive earnings estimate revisions.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

This combination indicates that Manhattan Associates is a potential outperformer and a solid choice for growth investors.

Zacks Investment Research

Manhattan Associates (MANH) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.

The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.

Individual investors often find it hard to make decisions based on rating upgrades by Wall Street analysts, since these are mostly driven by subjective factors that are hard to see and measure in real time. In these situations, the Zacks rating system comes in handy because of the power of a changing earnings picture in determining near-term stock price movements.

As such, the Zacks rating upgrade for Manhattan Associates is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.

Most Powerful Force Impacting Stock Prices

The change in a company's future earnings potential, as reflected in earnings estimate revisions, has proven to be strongly correlated with the near-term price movement of its stock. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.

For Manhattan Associates, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company's underlying business. And investors' appreciation of this improving business trend should push the stock higher.

Harnessing the Power of Earnings Estimate Revisions

As empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.

The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Earnings Estimate Revisions for Manhattan Associates

This business software company is expected to earn $4.61 per share for the fiscal year ending December 2024, which represents a year-over-year change of 23.3%.

Analysts have been steadily raising their estimates for Manhattan Associates. Over the past three months, the Zacks Consensus Estimate for the company has increased 13%.

Bottom Line

Unlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings for its entire universe of more than 4000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a 'Strong Buy' rating and the next 15% get a 'Buy' rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.

The upgrade of Manhattan Associates to a Zacks Rank #2 positions it in the top 20% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.

Zacks Investment Research

Wall Street is on track for its third consecutive day of losses as investors grow cautious about risky assets, awaiting more clarity on U.S. fiscal and monetary policies and scrutinizing the latest batch of corporate earnings.

Both equities and commodities took a hit on Wednesday, while the U.S. dollar gained strength, attracting investor flows as traders moved to safer cash positions.

The U.S. dollar index, as tracked by the the Invesco DB USD Index Bullish Fund ETF , rose 0.5%, reaching levels last seen in late July.

At midday in New York, the S&P 500 was down 0.7%, attempting to hold support around the 5,800-point level. The Dow Jones also dropped 0.7%, and tech stocks, along with small caps, fared worse, sliding by 0.9%.

On the data front, mortgage applications declined for the fourth straight week, reflecting continued pressure from elevated borrowing costs.

Existing home sales fell by 1% in September to a seasonally adjusted annualized rate of 3.84 million, the lowest level since October 2010. This follows an upwardly revised 3.88 million in August and missed forecasts of 3.9 million.

Despite weak housing data, real estate stocks showed surprising resilience. The Vanguard Real Estate ETF and the SPDR Homebuilders ETF moved higher after two straight sessions of losses.

Gold prices, as tracked by the SPDR Gold Trust , fell more than 1%, pulling mining stocks down with it. Silver plummeted over 3%, retreating from 12-year highs reached on Tuesday.

Oil prices slipped by 1%, while Bitcoin tumbled 2%.

Wednesday’s Performance In Major U.S. Indices, ETFs

According to Benzinga Pro data:

• The SPDR S&P 500 ETF Trust fell 0.6% to $579.72.
• The SPDR Dow Jones Industrial Average inched 0.7% lower to $426.41.
• The tech-heavy Invesco QQQ Trust Series fell 1% to $491.16.
• The iShares Russell 2000 ETF fell 0.7% $219.80.
• The Real Estate Select Sector SPDR Fund outperformed, up 0.6%. The Consumer Discretionary Select Sector SPDR Fund lagged, down 1%.

Wednesday’s Stock Movers

• Boeing Co. fell 2.4% after reporting a worse-than-expected losses last quarter.

Other stocks reacting to earnings included:

• Texas Instruments Inc. , up 3.5%.
• Baker Hughes Co. , up 3.9%.
• Seagate Technology Holdings PLC , down over 7%.
• Packaging Corporation of America , up over 6%.
• Manhattan Associates Inc. , down over 7%.
• East West Bancorp. Inc. , up over 7%.
• Enphase Energy Inc. , down over 13%.
• Coca-Cola Co. , down 2.2%.
• Thermo Fisher Scientific Inc. , down 2.9%.
• NextEra Energy Inc. , down 0.1%.
• AT&T Inc. , up 3.8%.
• Boston Scientific Corp. , down 3.7%.
• CME Group Inc. , down 0.9%.
• GE Vernova Inc. , down 1.6%.
• Hilton Worldwide Holdings Inc. , down 2.6%.
• Vertiv Holdings LLC , down 2.8%.
• Old Dominion Freight Line Inc. , down 4.8%.

Large-cap companies reporting earnings after the close include Tesla Inc. , T-Mobile US Inc. , International Business Machines Corp. , ServiceNow Inc. , Lam Research Corp. , Newmont Corp. , United Rentals Inc. , Las Vegas Sands Corp. , Raymond James Financial Inc. .

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