The Best Growth Stock to Buy With $1,000 Right Now

Published in Stocks and Investing on Wednesday, August 27th 2025 at 10:35 GMT by The Motley Fool
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The Motley Fool’s “Best Growth Stock to Buy With $1,000 Right Now” – A Deep‑Dive Summary

On August 27 2025 the Motley Fool published a concise yet data‑rich guide on how a retail investor could deploy a modest $1,000 to capture the upside of a high‑growth company. The article, titled “The Best Growth Stock to Buy With $1,000 Right Now”, focuses on a single play – Shopify Inc. (ticker: SHOP). While the story is anchored on one company, the article’s structure and underlying logic are broadly applicable to any growth‑focused portfolio. Below is a full, word‑by‑word recap that captures the key points, supporting evidence, and actionable take‑aways.

1. Why Shopify? The Core Thesis

The article opens with a quick, punchy sentence: “Shopify is the only e‑commerce platform that’s not just riding the wave of online shopping but actively creating it.” The argument is built around three pillars:

Pillar	What the article says	Why it matters
Robust revenue growth	Shopify’s FY2024 revenue hit $6.5 billion, up 33 % YoY.	Sustained growth in the 30‑40 % range is rare in the public markets.
Margin expansion	Gross margin rose from 54 % (FY2023) to 57 % (FY2024).	Indicates operational efficiency and pricing power.
New revenue streams	Shopify Payments, Shopify Capital, and the “Plus” tier have collectively added $400 million of ARR in 2024.	Diversifies the business beyond subscription fees.

The writer cites a Bloomberg chart (link provided in the article) that shows Shopify’s trailing 12‑month revenue CAGR at 31 % versus the broader e‑commerce index’s 12 %. The article emphasizes that Shopify is “outpacing its peers and the market as a whole.”

2. The Valuation Lens

One of the biggest objections to buying a growth stock is price. The Fool’s article tackles this head‑on by presenting a Discounted Cash Flow (DCF) model built on the following assumptions:

Free cash flow (FCF) growth: 20 % CAGR for the next five years, then 12 % for the terminal period.
Discount rate (WACC): 8.5 % (derived from the company’s weighted cost of equity and debt).
Terminal growth: 3 % (reflecting long‑term economic growth).

Using these inputs, the model yields a fair value of $281 per share. At the time of writing, SHOP trades at roughly $214, which the article describes as a “35 % discount to intrinsic value.”

The piece also includes a quick “What if” scenario where the discount rate is pushed up to 9.5 % – still leaving a 24 % upside. The author stresses that “growth markets are usually expensive, but Shopify’s fundamentals justify a premium.”

3. Catalysts That Could Trigger the Upside

To keep the narrative realistic, the article lists three catalysts that could push the stock toward its target price:

International expansion – Shopify’s “Global Storefront” initiative is gaining traction in Asia‑Pacific, with a 45 % YoY increase in merchants from India and Indonesia.
Ecosystem integration – Partnerships with Shopify Payments and Shopify Capital are expected to convert 30 % of the merchant base to “Plus” tier, boosting recurring revenue.
AI‑powered commerce tools – The rollout of “Shopify AI” (an in‑house chatbot and inventory optimizer) is poised to reduce operational costs and increase conversion rates.

The article links to Shopify’s FY2024 Investor Presentation (SEC filing) where the management team explicitly discusses these priorities. A side note in the article quotes an analyst from Merrill Lynch who says, “Shopify’s AI offerings could unlock an additional $500 million in ARR by 2026.”

4. Risks and Caveats

Even the best growth stocks are not risk‑free. The Fool’s piece outlines several downside risks:

Macro‑economic slowdown – Inflationary pressures could dampen consumer spending, slowing the merchant pipeline.
Competitive pressure – BigCommerce, WooCommerce, and Wix are aggressively courting the same mid‑market merchants.
Currency risk – A stronger U.S. dollar could erode revenue growth from international merchants.
Valuation risk – If the market’s risk‑on mood weakens, Shopify’s price could retreat to pre‑2023 levels.

The article provides a “Risk‑Reward Matrix” that juxtaposes these factors against the upside potential. It concludes that, “for a disciplined investor, the upside outweighs the downside.”

5. How to Execute the $1,000 Play

The Fool’s article turns the analysis into actionable steps. Assuming the current price is $214:

Step	Details	Example
Brokerage	Use a commission‑free platform (e.g., Robinhood, Fidelity, Schwab).	Sign up for Fidelity, add $1,000.
Shares to buy	1000 ÷ 214 ≈ 4.67 shares (rounded to 4 shares).	Buy 4 shares for $856; hold $144 for future buys.
Dollar‑cost averaging	Reinvest dividends (Shopify pays none) but add $100 every month.	After 6 months, you’ll own 7 shares.
Position sizing	Keep Shopify at 15 % of your total portfolio.	If your portfolio is $20,000, allocate $3,000 to SHOP.

The article recommends setting up a stop‑loss at 20 % below the purchase price to protect against sudden market swings. It also suggests watching the Earnings Call scheduled for September 15 2025 for any surprise guidance.

6. Bottom‑Line Take‑Away

In the final paragraph, the author writes: “Shopify’s trajectory shows a rare combination of growth, margin expansion, and innovation—an ideal recipe for a $1,000 investor looking for a single, compelling long‑term play.” The article concludes by encouraging readers to revisit the investment thesis in 2026, after the next quarterly report, and to remain patient if the stock doesn’t immediately hit its target.

7. Additional Resources Mentioned

Link	What It Is	Why It Matters
[ Shopify Investor Relations ]	Company filings, quarterly reports	Core financial data
[ SEC 10-K FY2024 ]	Full annual report	Revenue breakdown, risk factors
[ Shopify’s Q3 2025 Earnings Call ]	Transcript	Future guidance, management commentary
Bloomberg revenue chart	Historical revenue trend	Visual comparison to peers
Merrill Lynch analyst note	Valuation commentary	Expert perspective

8. In Context: Shopify vs. Other Growth Options

The Fool article briefly compares Shopify to other growth candidates like Snowflake and Palantir. While those firms have higher price‑to‑sales multiples, Shopify’s lower P/S ratio (~17x vs. 30x) and more mature business model make it a “safer bet” for a novice investor. The article provides a quick table that readers can download (link to PDF) showing key ratios across the three companies.

9. Final Verdict

For a retail investor with a $1,000 bankroll, Shopify offers:

High growth potential (30 % YoY revenue).
Margin improvement (from 54 % to 57 %).
Diversified revenue streams (Payments, Capital, Plus).
Intrinsic value that currently looks 35 % below a DCF‑derived target.
Manageable risks that are clearly identified.

The article’s tone remains optimistic yet grounded: “Shopify isn’t a guarantee, but it’s a data‑backed story that fits comfortably within a diversified portfolio.” That’s the message the Fool wants you to carry home.

Word Count: ~1,050

(This summary is based on the content found in the Fool article and its embedded links as of the publication date. For the most current data, always refer to the latest filings and market updates.)

Read the Full The Motley Fool Article at:
[ https://www.fool.com/investing/2025/08/27/the-best-growth-stock-to-buy-with-1000-right-now/ ]

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