Shopify hits record as e-commerce enabler becomes 'one of the greatest' stock stories of all time

An Apple iPad with the Shopify app is displayed at the entrance to the company's headquarters in Toronto, Ontario.
Kevin Van Paassen | Bloomberg | Getty Images

It's hard to imagine challenging Amazon's dominance in the e-commence space, but the coronavirus pandemic just brought Canadian start-up Shopify closer to being a serious threat to the trillion-dollar juggernaut.

The Ottawa-based company is giving small businesses a fighting chance by allowing them to quickly move operations online during the forced shutdowns.

Shopify shares have been on a tear, soaring 20% in May alone and pushing its 2020 gains to more than 90%. The company also surged past Royal Bank of Canada to become Canada's largest company by market value. The stock, which went public in May 2015, hit another all-time high on Wednesday. 

"To me, it's a company enabling small businesses to get more in line with what the post-pandemic economy looks like," said Dan Nathan, principal of RiskReversal Advisors.

Shopify is experiencing a surge in sales and users during these unprecedented times. Last week, Shopify reported that its sales grew by 47% to $470 million in the first quarter and continued to accelerate in April, while new stores created on the platform grew 62% in a six-week period during the pandemic. 

"We are working as fast as we can to support our merchants by re-tooling our products to help them adapt to this new reality," Shopify CEO Tobi Lutke said in a statement last week. "Our goal is that, because Shopify exists, more entrepreneurs and small businesses will get through this."

One of the appeals for using Shopify is that companies can sell products on their own website, instead of listing items on an Amazon-style marketplace. This month, Shopify also announced a partnership with Pinterest, which allows merchants to share their products to about 350 million users.