03:55 PM EST, 01/22/2025 (MT Newswires) -- Shopify ( SHOP ) may report better-than-expected results for the fourth quarter, while a weak first-quarter guidance tied to seasonality could create a buying opportunity, RBC Capital Markets said in a Wednesday note.

The e-commerce platform is expected to show strength in gross merchandise volume, or GMV, and margins when it reports holiday-quarter results on Feb. 11, according to RBC analyst Paul Treiber.

Data published by the Census Bureau last week indicating that e-commerce spending rose 8.7% year over year in the fourth quarter implies Shopify's ( SHOP ) GMV grew nearly 26% to $94.4 billion, Treiber said. That would be above the consensus at $92.9 billion and RBC's $93.4 billion estimate.

"GMV is typically the most impactful driver of Shopify's ( SHOP ) quarterly results (versus) consensus," Treiber said. "The strengthening in growth through December is incrementally positive relative to Shopify's ( SHOP ) (Black Friday-Cyber Monday) results at the start of December," which suggested an in-line GMV, he said.

Shopify ( SHOP ) reported early in December that its merchants reached a record $11.5 billion in sales during the key holiday shopping weekend, a 24% year-over-year increase.

The brokerage warned clients to prepare for first-quarter seasonality, with Treiber noting that the period is typically soft. Over the last three years, revenue has been down an average 13% sequentially in the first quarter.

The consensus is modeling for a 15% sequential top-line decline in the first quarter. While that's largely aligned with historical trends, Shopify's ( SHOP ) guidance has surprised to the downside in the past, he said. The company's shares have lost an average 17% following fourth-quarter results over the past three years, the research report showed.

The brokerage reiterated an outperform rating and a $130 price target on the stock.

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