By Emily Dattilo

Shopify should turn in strong results for an important industry metric when it files its quarterly earnings on Tuesday, Benchmark argues.

Analysts Mark Zgutowicz and Alex Lavigne upgraded shares of the e-commerce platform to Buy from Hold. They set a target for the price of $150.

Shopify stock gained 3.2% to $121.22 in early trading Monday. Over the last 12 months, shares have increased 37%.

The analyst team believes Shopify will turn in higher gross merchandise volume and more positive financial guidance than expected. Part of that stems from users upgrading to Shopify Audiences, a tool that aids in finding new customers by creating custom audiences for advertising platforms. The tool is currently only available to a select group of merchants paying for a higher tier, but the returns generated from the prospective audience lists "more than compensate" the cost of a pricier membership, the analysts wrote.

Merchants are also upbeat about the "pay-per-sale" ads product known as Shopify Campaigns.

Benchmark believes that this year, the company will make Shopify Audiences and Campaigns available to more merchants and in more geographic areas. Eventually, new marketing capabilities including generative artificial intelligence and creative tools could be launched, creating the potential for the company to cash in on that technology.

Write to Emily Dattilo at emily.dattilo@dowjones.com

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February 10, 2025 10:23 ET (15:23 GMT)

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