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My Top Growth Stock to Buy for 2026 (and It's Not Even Close) | The Motley Fool

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  Published in Stocks and Investing on Monday, September 22nd 2025 at 0:01 GMT by The Motley Fool
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Why a Non‑EV Growth Stock Should Be in Your Portfolio This Year

In a market that is saturated with electric‑vehicle (EV) hype—from Tesla’s record‑setting rallies to the newest “green” start‑ups on the brink of a funding round—the Motley Fool’s latest top‑pick article draws a bold, counter‑current line. “My Top Growth Stock to Buy for the Year and It’s Not EV” is a no‑frills recommendation for a company that is growing fast, is well‑valued, and is far from the volatility that characterises the EV space. The pick? Shopify Inc. (SHOP).

The Business in a Nutshell

Shopify is the world’s leading e‑commerce platform, giving small and medium‑sized merchants the tools to set up an online storefront, take payments, ship products, and market to customers—all in one place. The company’s revenue streams are split into:

• Subscription services – recurring fees for using Shopify’s core platform.
• Merchant solutions – a suite of add‑ons (shipping, fulfillment, point‑of‑sale, etc.) that boost merchants’ margins.
• Other services – including Shopify Capital (merchant financing) and the newer Shopify Fulfillment Network.

This “platform‑as‑a‑service” model offers predictable recurring revenue and a strong moat: the more merchants adopt Shopify, the harder it becomes for them to leave.

2024 Numbers That Make a Case

• Revenue growth: Shopify’s most recent quarterly report (Q3 2024) recorded a 19% YoY jump to $4.7 billion, the fastest pace in five years. Analysts note that this growth is powered primarily by a surge in the Shopify Plus tier, which caters to high‑volume brands that demand advanced customisation.
• Profitability: Gross margin has improved steadily, now sitting at 61% versus 56% in 2023—a sign that the company is mastering its cost structure as it scales.
• Cash flow: The firm generated $1.3 billion of operating cash flow in 2024, an increase of 35% year‑over‑year, giving it ample runway to reinvest in product development and potential acquisitions.

Valuation – A Margin for Growth

The Motley Fool’s analysis places Shopify at a forward price‑to‑earnings (P/E) ratio of roughly 45x—sub‑premium to the broader e‑commerce tech group that includes Amazon (P/E ~70) and Etsy (P/E ~55). With a projected 2025 EPS of $6.00 and a target price of $450, the upside potential sits at about +50% from the current trading price of $300. The article stresses that this valuation is attractive when considered against the backdrop of a high‑growth platform that is still far from saturating its addressable market.

Catalysts That Could Push the Stock Higher

1. Expansion of Shopify Plus – As large‑brand merchants (e.g., Nike, Adidas) experiment with multi‑channel selling, Shopify is positioned to capture a larger slice of the high‑volume market.
2. New Fulfillment and Logistics Network – The company’s “Shopify Fulfillment Network” aims to rival Amazon’s logistics prowess, potentially increasing merchant retention.
3. Strategic Partnerships – Recent collaborations with TikTok for in‑feed shopping and with Facebook’s Meta for integrated ad‑commerce solutions open up new revenue streams.
4. Global Footprint – Shopify is aggressively targeting European and Asian markets, offering localized storefronts and payment gateways that cater to local merchants.

Risks to Keep in Mind

Even with an optimistic outlook, the article cautions against overlooking certain headwinds:

• Intense competition – Amazon’s “Shopify for Enterprise” and other platforms (e.g., BigCommerce, WooCommerce) present head‑to‑head challenges.
• Macroeconomic uncertainty – A slowdown in consumer discretionary spending could reduce merchants’ willingness to invest in premium features.
• Regulatory risks – The company’s global expansion exposes it to varying tax regimes and data‑privacy laws, potentially impacting operating costs.
• Dependence on merchant success – Shopify’s revenue is largely tied to the performance of its merchants; a broad downturn in the retail sector could affect earnings.

Why the Article Calls It “My Top Growth Stock”

The Motley Fool writer frames the recommendation around a few key themes that are common in top‑growth picks:

• High growth, low margin compression – Shopify’s revenue is still growing, and margins are improving—indicating a scalable business model.
• Strong free cash flow – The company’s cash generation suggests it can invest in innovation or return capital to shareholders without external financing.
• Undervalued relative to peers – Shopify trades below many of its direct competitors, implying there is room for price appreciation as the market recognises its upside.
• Strategic positioning in a rising industry – The shift toward online commerce, amplified by post‑COVID acceleration, gives Shopify a durable competitive advantage.

The article ends with a call to action for growth‑oriented investors: “If you’re looking for a high‑growth platform that’s firmly rooted in an expanding industry—and not riding the hype train of EVs—Shopify is a compelling addition to any portfolio.” It encourages readers to add the stock for the coming year, noting that “the fundamentals and catalysts put Shopify on a trajectory for significant upside.”

Final Thoughts

While the excitement surrounding electric‑vehicle stocks can make other growth opportunities seem secondary, Shopify’s combination of solid financials, rapid revenue growth, and strategic innovation makes it a standout in the current market environment. The Motley Fool article presents a balanced view: while the upside is substantial, investors should be mindful of competitive and macro risks. For those seeking a growth play that is not tied to the volatility of the EV sector, Shopify appears to be a prudent and timely choice.