Shopify (SHOP) Compounded 29% Annually. Here’s How

Group 1: Fund Performance - Rowan Street Capital's fund remained unchanged in Q3 2025, with a return of +0.22%, leading to a year-to-date return of +20.4% net of fees, outperforming the S&P 500's +14.8% [1] - Over the past three years, the firm's capital compounded at approximately +54.2% annually, resulting in a cumulative return of +266%, significantly exceeding the S&P 500's +24.9% annualized gain [1] Group 2: Shopify Inc. Overview - Shopify Inc. (NASDAQ:SHOP) has been in Rowan Street Capital's portfolio for over three years, compounding at 29% annually and being the best performer in 2025 [3] - The stock's one-month return was 8.86%, and it gained 103.38% over the last 52 weeks, closing at $162.01 per share with a market capitalization of $210.003 billion on October 22, 2025 [2] Group 3: Shopify Inc. Performance Drivers - Shopify's performance is attributed to operating leverage, margin expansion, and renewed investor confidence in its long-term growth prospects [3] - The company is enhancing its ecosystem through product innovation, deeper merchant integration, and new AI-driven tools, including a partnership with ChatGPT [3] Group 4: Market Position and Competitiveness - Shopify delivered $2.7 billion in revenue for Q2 2025, reflecting a 31% year-over-year increase [4] - Despite its potential, Shopify is not among the top 30 most popular stocks among hedge funds, with 69 hedge fund portfolios holding the stock at the end of Q2 2025, down from 77 in the previous quarter [4]