Well positioned to deliver growth? – Shopify Inc. (SHOP), Intercept Pharmaceuticals Inc. (ICPT)

Shopify Inc. (NYSE: SHOP) shares are 185.31% up in the year-to-date (YTD) period and have moved 6.37% or $67.9 higher in the latest trading session. However, stock’s trailing 12-month performance remains nearly +271.54% lower. Comparatively, the stock is -1.10% down YTD and 48.86% over the trailing 3-month period. If we look at the shorter duration, its week performance is 9.36% and 4.73% over the month.

Analyst Recommendations

On July 30, 2020, Rosenblatt recommended the SHOP stock is a Buy, while earlier, Atlantic Equities had Initiated the stock as a Overweight on August 26, 2020. 33 analysts offering the recommendations for the stock have a consensus rating of 2.60 to suggest that the SHOP stock is a “Moderate Buy. 2 of the 33 analysts rate the stock as a “Sell”, while 1 has rated it as “Underweight”. 11 recommend buying, with 2 rating it as an Overweight.

The stock currently trades at $1134.32 and analysts tracking its performance over the next 12 months have a consensus estimate price target of $1094.83. The forecasts give the Shopify Inc. stock a price target range of $1400.00 on the higher side while at least one analyst think the stock could plunge to a low of $450.00. The two limits represent an upside potential of 18.98% or -152.07%.

Earnings Forecast

Analysts estimate the earnings to increase 10,400.00% in the current quarter to $0.48, up from the -$0.29 reported in the same quarter a year ago. For the current year, earnings should grow to an average of $2.41, up 64.00% from $0.3 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between $0.2 and $1.13. Wall Street estimates earnings per share to be at an average of $2.3 for the next year.

Intercept Pharmaceuticals Inc. (NASDAQ:ICPT), on the other hand, is trading around $44.53 with a market cap of $1.45B and analyst research firms have a negative stance on its shares. Analysts predict that the stock will reach $67.68 and spell out a more modest performance – a 34.21% return. Some analysts are even forecasting -$8.62 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the Intercept Pharmaceuticals Inc. (ICPT) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

ICPT’s operating expenses over the recent quarter were at $128.28 million. This represented a -66.06% of the company’s total revenues which amounted $77.25 million. With this in place, we can see that the company’s diluted EPS declined -$1.92 on the year-over-year period, shrinking to -$2.28 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Sep 2020), the total assets figure advanced to $637.49 million from $662.38 million over the previous quarter. Short term investments amounted to $483.7 million while total current assets were at $606.65 million. The cash flow from operating activities totaled -$113.57 million, significantly higher than the -$129.37 million reported in the year-ago quarter. The company’s free cash flow for the quarter was -$114.23 million.

Insider activity

Insiders have transacted a total of 51 times at Intercept Pharmaceuticals Inc. over the last 6 months, with insider purchases undertaken 7 times and accounting for 11,165 shares. Insider sales totaled 5,700,298 shares over the same period, with these deals completed in 44 transactions. Looking at these numbers, we realize that net purchases over that period are -37.0 shares. Insiders now hold a total of 7.1M shares after the latest sales, with -46.90% net shares purchased.

Major holders

Insiders own 14.50% of the company shares, while shares held by institutions stand at 83.90% with a share float percentage of 27.80M. Investors are also buoyed by the number of investors in a company, with Intercept Pharmaceuticals Inc. having a total of 295 institutions that hold shares in the company. The top two institutional holders are FMR, LLC with over 4.82 million shares worth more than $230.99 million. As of Jun 29, 2020, FMR, LLC held 14.62% of shares outstanding.

The other major institutional holder is Vanguard Group, Inc. (The), with the investment firm holding over 2.49 million shares as of Jun 29, 2020. The firm’s total holdings are worth over $119.07 million and represent 7.54% of shares outstanding.