Count Shopify Inc. (SHOP) among the stocks that have been caught up in fears of artificial intelligence (AI) disruption. Shares of the Canada-based e-commerce infrastructure and platform provider have lost nearly a third of their value this year as investors sized up AI-related threats.
Put simply, market participants are pondering the extent to which generative AI could be a drag on the Shopify financial model. As Deutsche Bank analyst Bhavin Shah puts it, some investors may be viewing Shopify on par with the “SaaS-pocalypse” software victims who aren’t adequately articulating their AI monetization stories.
However, Shopify shouldn’t necessarily be lumped in with those offenders. Indeed, there may be opportunity for risk-tolerant traders with the Direxion Daily SHOP Bull 2X ETF (SHPU ). SHPU, which debuted last August, attempts to deliver 200% of the daily performance of Shopify’s Class A shares. For traders looking for reasons to consider the Direxion ETF, Shah saw upside potential in the stock. The analyst had a “buy” rating and a $175 price target on the e-commerce stock, implying significant upside from the June 18 close of $108.85.
Shopify AI Story May Be Better Than Investors Think
Shah noted that “concerns have emerged that subscription gross margins could remain under pressure due to incremental compute costs associated with Sidekick.” That places some burden on Shopify to prove to investors that its AI costs aren’t hindering margins.
On the surface, the punishment incurred by the stock this year may appear justified, thus eliminating a near-term case for SHPU. But upon closer examination, traders may have valid reasons to keep an eye on the Direxion ETF.
“Importantly, we believe these cost pressures are more than offset by the significant productivity gains and merchant value delivered by Sidekick, as evidenced by rapid adoption and positive user feedback,” added Shah. “As a result, we expect Shopify will be able to monetize Sidekick through price increases on its core subscription tiers over the next several quarters.”
Shopify’s accelerating business model, potentially overlooked amid its 2026 decline, supports occasional deployment of SHPU.
“The business is accelerating across every vector—revenue growth hit 34% in Q1 2026, GMV exceeded $100 billion for the second consecutive quarter, and international/B2B channels grew 36% and 80% respectively—while maintaining mid-teens free cash flow margins, demonstrating rare operational leverage at scale,” according to EveryTicker.
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