Shopify gets its first taste of trouble as a pubco

Well, it couldn’t go up forever.

Following a fairy-tale IPO and market debut that served as a punctuation mark, shares of Shopify (Shopify Stock Quote, Chart, News: TSX:SH, NYSE:SHOP) are under pressure for the second day in a row.

On the TSX, shares of the Ottawa-based ecommerce player are down 6% today, currently trading at $40.90. That’s after the company fell $3.69 yesterday following closing at a high of $47.19 on Wednesday. All in all, the stock is down more than 15 per cent in two days.

One portfolio manager, however, says the action on the stock isn’t cause for panic.

“This is a company with a massive addressable market, it’s a good company that is materially changing the way things work in terms of empowering small companies to sell their product,” says StableView Asset Management President and Portfolio Manager Colin Fisher. “But these things do not go up in straight lines, and it might have gotten a little ahead of itself. It will probably fill in the value over the coming quarters.”

In April, Shopify announced it had filed for an initial public offering of up to $100 million, with Morgan Stanley, Credit Suisse and RBC Capital Markets as lead managers. The company then increased the range of its IPO to (U.S.) $17.00, from the $14.00 to $16.00 range it had initially guided, and expanded its financing to $131-million.

Founded in 2004, Shopify now counts more than 100,000 retail customers from 150 countries, from small boutique retailers to Fortune 500 companies like IBM and General Electric. The company claims to have processed over $5 billion worth of transactions last year, using its easily deployed sales processing platform. The company’s revenue has risen from $23.7 million in 2012 to $105 million in 2014.

Below: Shopify CEO Tobi Lütke gives the keynote at Accelerate Ottawa…