MF: $SHOP & $STNE Billionaires Are Buying

2 Growth Stocks Down 81% and 90% That Billionaires Keep Buying

By Cory Renauer - Aug 28, 2022 at 5:29AM

:pushpin: The largest investors in America have to disclose their purchases to the U.S. Securities and Exchange Commission each quarter.

:pushpin: Renaissance Technologies, helmed by James Simons, started a new position in Shopify during the second quarter.

:pushpin: Point72 Asset Management, led by Steven Cohen, bought shares of StoneCo, a fintech that enables cross-border e-commerce.

Since its founding in 2006, Shopify has emerged as the leader when it comes to providing merchants with business solutions. The company has expanded from just offering online stores that accept payments to offering point-of-sale and fulfillment solutions.

The stock has been under pressure lately because it’s investing heavily in warehouses and fulfillment services in an attempt to keep up with Amazon. The investments are working. More merchants joining Shopify plus existing merchants keeping their subscriptions pushed monthly recurring revenue during the second quarter 13% higher year over year.

Amazon is still the king of e-commerce in North America, but Shopify has significant advantages. For example, third-party sellers can easily get lost in a sea of competitors that often include Amazon itself. When merchants sell products on Shopify, they can retain far more control over their relationships with customers than they’d would from Amazon.

$SHOP daily chart

$STNE daily chart

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I’ve been busy closing out about a half-dozen profitable trades today, but one I am allowing to run more will be $SHOP. In fact, this has turned from a “nibble” opening + add on trade to one where I’ll just keep adding “zero cost” $SHOP shares from other successful trades.

I like $SHOP’s new focus on building warehouses in the USA and Canada. I think these guys are figuring out they can be an oasis for people tired of Amazon predatory practices against sellers.

$SHOP broke out on the daily chart this past Wednesday.

$SHOP daily chart

$SHOP weekly chart

$SHOP monthly chart

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