Shopify (SHOP, Financial) is gearing up to report its first-quarter earnings on Thursday, May 8, before the market opens, and investors are watching closely.

Analysts expect earnings of $0.27 per share and revenue of $2.37 billion. That would mark year-over-year growth of 35% and 27%, respectively.

But despite the upbeat forecast, Shopify stock is down about 8% year-to-date. The drop comes as investors worry about potential fallout from U.S. trade changes, especially around the elimination of the de minimis rule.

That rule currently allows duty-free imports on shipments under $800 from places like China. If it's scrapped, Shopify's many small business sellers could face rising costs.

In Q4 2024, Shopify missed on earnings but beat revenue estimates. Gross merchandise volume grew nearly 26%, up from 24% in Q3. Management said that momentum likely continued into Q1, even though the first quarter is typically the slowest of the year.

Jefferies cut its price target to $110 and maintained a Hold rating, citing strong performance but growing tariff uncertainty.

Is SHOP a Buy Before Earnings?

Based on the one year price targets offered by 43 analysts, the average target price for Shopify Inc is $132.95 with a high estimate of $175.00 and a low estimate of $87.64. The average target implies a upside of +35.14% from the current price of $98.38.

Based on GuruFocus estimates, the estimated GF Value for Shopify Inc in one year is $109.15, suggesting a upside of +10.95% from the current price of $98.38.