As the year comes to a close and we look toward 2026, Shopify (TSX:SHOP) stock stands as a titan of the digital economy that has significantly outperformed the broader market throughout 2025. With a year-to-date gain of approximately 52.8% at writing, SHOP stock has widely outperformed the market. Could this momentum persist into 2026 and help growth-oriented investors outperform the market again next year, or is the ecommerce software giant’s valuation stretched beyond its fundamental limits?
Shopify stock in 2026: Ushering in agentic commerce
As the artificial intelligence (AI) era continues to evolve, the most significant catalyst for Shopify stock in 2026 could be “Agentic Commerce.” Insights from the recent 53rd Annual Nasdaq Investor Conference highlight that Shopify is already ahead of the innovation curve with tools like Sidekick and its Catalog products. Late in 2025, Shopify reported that AI-driven traffic on its platform had surged sevenfold since the start of the year, while AI-driven orders increased by a staggering 11 times.
In 2026, these autonomous agents will manage end-to-end workflows for more merchants, simplify operations, and create a new commerce channel wherein AI assistants handle searching and sorting, making brand discovery more efficient for consumers and potentially increasing overall merchant spend.
A merchant solutions growth engine
Shopify has successfully evolved from a simple subscription-based store builder into a transaction-driven powerhouse. By the third quarter of 2025, Merchant Solutions accounted for roughly 75.4% of total revenue, growing at a robust 38% year-over-year rate. This segment is fueled by the deepening penetration of Shopify Payments, which processed 65% of the platform’s Gross Merchandise Volume (GMV) by late 2025.
The company’s focus on enterprise and business-to-business (B2B) markets is also yielding high-margin results. B2B GMV grew 98% in the third quarter of 2025, while the “Shopify Plus” tier now contributes 35% of monthly recurring revenue. This shift toward larger, more stable merchants provides a defensive buffer against economic volatility while allowing Shopify to capture a larger share of every dollar spent on its platform, making SHOP stock much more valuable.
Shopify’s global expansion drive building geographic moats
While North America remains its core market, Shopify is aggressively capturing international market share. In 2025, European GMV grew by 42% on a constant currency basis, with the company recently expanding its payments infrastructure to 16 new countries. CFO Jeff Hoffmeister has signalled that 2026 will see further rollouts in Central and South America, the Middle East, and Southeast Asia. By building localized payment and logistics “rails” in these regions, Shopify is creating a significant competitive moat that most competitors may fail to replicate in 2026 and beyond.
Financial discipline and growing cash flow make SHOP stock attractive
Perhaps the most encouraging sign for long-term investors is Shopify’s commitment to sustainable profitability. The company should sustain its trend of delivering consecutive quarters of double-digit free cash flow (FCF) margins into 2026. Bay Street projects its total revenue to grow 23.5% from about US$11.5 billion in 2025, nearly double the average industry revenue growth rates for 2026. A combination of above-average growth rates and disciplined cost control makes Shopify’s business model a winning trade for 2026 for investors willing to pay the steep price.
The valuation hurdle
The primary risk for buying Shopify stock for 2026 is its current valuation. Trading at a forward price-earnings (P/E) multiple of roughly 126.1 (compared to an industry average of 42.7), the stock is undeniably expensive.
For this valuation to be sustained in 2026, Shopify must maintain its current innovation rate and ensure that its new product launches gain immediate traction. Any deceleration in consumer spending or a miss in earnings growth targets could lead to a significant price correction.
Is Shopify stock a Buy, Sell, or Hold?
If you are a long-term investor focused on sustained ecommerce growth and the “AI-first” future of retail, Shopify stock is a compelling buy. Its leadership in Agentic Commerce and dominance in the merchant solutions market make it the definitive platform for the next decade of commerce.
That said, the current stock price offers “perfection” pricing for conservative investors. While the fundamentals are stellar, the steep valuation leaves little room for error. Waiting for a macroeconomic pullback or a temporary earnings-related dip might provide more attractive entry points.
Otherwise, investors who believe the “agentic” hype is ahead of actual consumer adoption may find the current valuation a perfect opportunity to take profits.
