SHOP vs. ZM: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at SHOP and ZM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | SHOP | ZM |
|---|---|---|
| Company Name | Shopify Inc. | Zoom Communications Inc. |
| Country | Canada | United States |
| GICS Sector | Information Technology | Information Technology |
| GICS Industry | IT Services | Software |
| Market Capitalization | 182.54 billion USD | 25.29 billion USD |
| Exchange | NasdaqGS | NasdaqGS |
| Listing Date | May 20, 2015 | April 18, 2019 |
| Security Type | Common Stock | Common Stock |
Historical Performance
This chart compares the performance of SHOP and ZM by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.
Historical Performance at a Glance
| Symbol | SHOP | ZM |
|---|---|---|
| 5-Day Price Return | -0.15% | -3.23% |
| 13-Week Price Return | 28.83% | 4.78% |
| 26-Week Price Return | 42.51% | 5.86% |
| 52-Week Price Return | 87.62% | 16.55% |
| Month-to-Date Return | 5.19% | -1.48% |
| Year-to-Date Return | 39.76% | -0.40% |
| 10-Day Avg. Volume | 7.93M | 3.00M |
| 3-Month Avg. Volume | 7.76M | 3.21M |
| 3-Month Volatility | 57.32% | 34.63% |
| Beta | 2.75 | 0.82 |
Profitability
Return on Equity (TTM)
SHOP
20.91%
IT Services Industry
- Max
- 32.78%
- Q3
- 19.28%
- Median
- 13.86%
- Q1
- 5.50%
- Min
- -10.00%
In the upper quartile for the IT Services industry, SHOP’s Return on Equity of 20.91% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
ZM
13.40%
Software Industry
- Max
- 66.28%
- Q3
- 21.28%
- Median
- 9.33%
- Q1
- -8.77%
- Min
- -48.16%
ZM’s Return on Equity of 13.40% is on par with the norm for the Software industry, indicating its profitability relative to shareholder equity is typical for the sector.
Net Profit Margin (TTM)
SHOP
23.42%
IT Services Industry
- Max
- 19.71%
- Q3
- 11.01%
- Median
- 6.66%
- Q1
- 2.96%
- Min
- -6.22%
SHOP’s Net Profit Margin of 23.42% is exceptionally high, placing it well beyond the typical range for the IT Services industry. This demonstrates outstanding operational efficiency and a strong competitive advantage in converting revenue into profit.
ZM
24.99%
Software Industry
- Max
- 51.92%
- Q3
- 19.23%
- Median
- 6.98%
- Q1
- -7.14%
- Min
- -41.00%
A Net Profit Margin of 24.99% places ZM in the upper quartile for the Software industry, signifying strong profitability and more effective cost management than most of its peers.
Operating Profit Margin (TTM)
SHOP
12.40%
IT Services Industry
- Max
- 22.44%
- Q3
- 14.90%
- Median
- 8.82%
- Q1
- 4.91%
- Min
- -9.89%
SHOP’s Operating Profit Margin of 12.40% is around the midpoint for the IT Services industry, indicating that its efficiency in managing core business operations is typical for the sector.
ZM
20.43%
Software Industry
- Max
- 60.40%
- Q3
- 21.25%
- Median
- 9.90%
- Q1
- -4.97%
- Min
- -43.50%
ZM’s Operating Profit Margin of 20.43% is around the midpoint for the Software industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | SHOP | ZM |
|---|---|---|
| Return on Equity (TTM) | 20.91% | 13.40% |
| Return on Assets (TTM) | 17.30% | 10.88% |
| Net Profit Margin (TTM) | 23.42% | 24.99% |
| Operating Profit Margin (TTM) | 12.40% | 20.43% |
| Gross Profit Margin (TTM) | 49.34% | 76.38% |
Financial Strength
Current Ratio (MRQ)
SHOP
3.85
IT Services Industry
- Max
- 3.17
- Q3
- 2.00
- Median
- 1.47
- Q1
- 1.05
- Min
- 0.52
SHOP’s Current Ratio of 3.85 is exceptionally high, placing it well outside the typical range for the IT Services industry. This indicates a very strong liquidity position, though such a high ratio may also suggest that the company is not using its assets efficiently to generate profits.
ZM
4.45
Software Industry
- Max
- 4.29
- Q3
- 2.37
- Median
- 1.40
- Q1
- 1.03
- Min
- 0.25
ZM’s Current Ratio of 4.45 is exceptionally high, placing it well outside the typical range for the Software industry. This indicates a very strong liquidity position, though such a high ratio may also suggest that the company is not using its assets efficiently to generate profits.
Debt-to-Equity Ratio (MRQ)
SHOP
0.08
IT Services Industry
- Max
- 3.11
- Q3
- 1.55
- Median
- 0.55
- Q1
- 0.17
- Min
- 0.00
Falling into the lower quartile for the IT Services industry, SHOP’s Debt-to-Equity Ratio of 0.08 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
ZM
0.00
Software Industry
- Max
- 2.16
- Q3
- 0.86
- Median
- 0.31
- Q1
- 0.00
- Min
- 0.00
ZM’s Debt-to-Equity Ratio of 0.00 is typical for the Software industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
Interest Coverage Ratio (TTM)
SHOP
-0.29
IT Services Industry
- Max
- 129.00
- Q3
- 56.00
- Median
- 11.69
- Q1
- 0.77
- Min
- -28.15
SHOP has a negative Interest Coverage Ratio of -0.29. This indicates that its earnings were insufficient to cover even its operational costs, let alone its interest payments, signaling significant financial distress.
ZM
7.63
Software Industry
- Max
- 89.65
- Q3
- 32.64
- Median
- 1.00
- Q1
- -9.84
- Min
- -71.23
ZM’s Interest Coverage Ratio of 7.63 is positioned comfortably within the norm for the Software industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | SHOP | ZM |
|---|---|---|
| Current Ratio (MRQ) | 3.85 | 4.45 |
| Quick Ratio (MRQ) | 3.85 | 4.36 |
| Debt-to-Equity Ratio (MRQ) | 0.08 | 0.00 |
| Interest Coverage Ratio (TTM) | -0.29 | 7.63 |
Growth
Revenue Growth
EPS Growth
Dividend
Dividend Yield (TTM)
SHOP
0.00%
IT Services Industry
- Max
- 2.79%
- Q3
- 1.76%
- Median
- 0.58%
- Q1
- 0.00%
- Min
- 0.00%
SHOP currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
ZM
0.00%
Software Industry
- Max
- 0.22%
- Q3
- 0.11%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
ZM currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
Dividend Payout Ratio (TTM)
SHOP
0.00%
IT Services Industry
- Max
- 107.85%
- Q3
- 52.62%
- Median
- 22.53%
- Q1
- 0.00%
- Min
- 0.00%
SHOP has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
ZM
0.00%
Software Industry
- Max
- 3.29%
- Q3
- 2.41%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
ZM has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
Dividend at a Glance
| Symbol | SHOP | ZM |
|---|---|---|
| Dividend Yield (TTM) | 0.00% | 0.00% |
| Dividend Payout Ratio (TTM) | 0.00% | 0.00% |
Valuation
Price-to-Earnings Ratio (TTM)
SHOP
82.80
IT Services Industry
- Max
- 56.41
- Q3
- 33.17
- Median
- 23.17
- Q1
- 16.18
- Min
- 6.62
At 82.80, SHOP’s P/E Ratio is exceptionally high, exceeding the typical maximum for the IT Services industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
ZM
21.32
Software Industry
- Max
- 145.74
- Q3
- 94.88
- Median
- 45.35
- Q1
- 26.66
- Min
- 8.80
In the lower quartile for the Software industry, ZM’s P/E Ratio of 21.32 suggests the stock may be undervalued compared to its peers, potentially presenting an attractive entry point for investors.
Price-to-Sales Ratio (TTM)
SHOP
19.39
IT Services Industry
- Max
- 5.99
- Q3
- 4.26
- Median
- 1.93
- Q1
- 0.97
- Min
- 0.12
With a P/S Ratio of 19.39, SHOP trades at a valuation that eclipses even the highest in the IT Services industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
ZM
5.33
Software Industry
- Max
- 25.67
- Q3
- 13.68
- Median
- 8.28
- Q1
- 4.95
- Min
- 0.90
ZM’s P/S Ratio of 5.33 aligns with the market consensus for the Software industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio (MRQ)
SHOP
12.34
IT Services Industry
- Max
- 12.34
- Q3
- 7.54
- Median
- 3.84
- Q1
- 2.52
- Min
- 0.88
SHOP’s P/B Ratio of 12.34 is in the upper tier for the IT Services industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.
ZM
2.50
Software Industry
- Max
- 30.67
- Q3
- 14.92
- Median
- 8.52
- Q1
- 3.89
- Min
- 0.38
ZM’s P/B Ratio of 2.50 is in the lower quartile for the Software industry. From a value investing perspective, this is favorable, as it suggests the stock is trading at a discount to its net asset value and may offer a greater margin of safety.
Valuation at a Glance
| Symbol | SHOP | ZM |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 82.80 | 21.32 |
| Price-to-Sales Ratio (TTM) | 19.39 | 5.33 |
| Price-to-Book Ratio (MRQ) | 12.34 | 2.50 |
| Price-to-Free Cash Flow Ratio (TTM) | 106.86 | 13.73 |