Will Shopify survive U.S. tariffs?

With its NYSE co-listing and international scope, many could be excused for forgetting that Shopify (Shopify Stock Quote, Chart, News, Analysts, Financials NYSE:SHOP) is, in fact, as Canadian as curling.

So with the Trump administration 2.0 rattling about tariffs, will the company be an outsized target?

National Bank Financials analyst Richard Tse says Shopify needs to worry more about the tariffs imposed on China, but even then shouldn’t worry too much.

“In recent weeks, we’ve had a number of investor inbounds on Shopify with respect to the potential tariff implications for the Company. We think the genesis of those inbounds has to do with a perception that many of Shopify’s merchants source from China and given the new Trump administration has proposed significant tariffs, it’s become increasingly more topical,” Tse wrote. “That had us looking to assess the potential impact which is summarized in this note. Overall, our conclusion is that while we see some impact on Gross Merchandise Volume (GMV) and in turn Merchant Services (MS) revenue should the tariffs be fully imposed, we believe it’s relatively less severe in the context of all the current impending growth vectors in front of Shopify. We believe those scaling growth vectors increasingly reduce the potential headline exposure from tariffs. As such, we’d view any pullback from a tariff narrative as an opportunity to add a position(s) in the name. Shopify remains one of our Top Picks for 2025.”

In a research update to clients January 19, Tse maintained his “Outperform” rating and price target of (U.S.) $140.00, implying a return of 35.5% at the time of publication.

The analyst thinks the company will post Adjusted EBITDA of $1.49-billion on revenue of $8.79-billion in fiscal 2024. He expects those numbers will improve to Adjusted EBITDA of $1.92-billion on a topline of $10.8-billion in fiscal 2025.

“Overall, we estimate the potential upper bound impact on Shopify would be a -4.9% GMV contraction (~$17.2 bln decrease to our FY25 GMV forecast of ~$353 bln), which would imply a commensurate impact on Shopify’s MS revenue of $387 mln, or -3.6% to our FY25E revenue,” Tse added.