Canadian e-commerce company Shopify Inc logo is shown on a computer screen in the illustration photo in Encinitas, California May 3, 2016. REUTERS/Mike Blake/File Photo
October 11, 2017
By Alastair Sharp
TORONTO (Reuters) – Short-seller Andrew Left of Citron Research said on Wednesday that he is investigating various aspects of software company Shopify Inc’s business and will “most likely” publish a follow-up to the Oct. 4 report that sent its shares plunging.
“I am looking at many parts of the business,” Left told Reuters, adding that this would include aspects not covered by his initial report.
Asked if he would issue another report he replied: “Most likely.”
Shopify declined to comment.
Its chief executive, Tobi Lutke, tweeted on Tuesday that Left was a “short-selling troll” and he was looking forward to addressing his claims on the company’s next earnings call, due in three weeks.
Left responded that the comment “shows his immaturity as a CEO.”
Shopify, which provides online merchants with websites, payments and shipping services, has been a stock market darling since its trading debut in 2015 and the best-performing stock so far this year on the Toronto Stock Exchange composite index.
But its shares fell more than 11 percent on Oct. 4 after Citron Research published a report alleging the company engages in aggressive marketing practices that oversell the potential for its customers to make money.
The next day Shopify said: “We vigorously defend our business model and stand resolutely behind our mission and the success of our merchants.”
The stock lost more than 20 percent of its value between the close on Oct. 3 and the close on Tuesday. On Wednesday, its U.S.-listed shares rose as much as 4.3 percent to $96.59, but pared gains after the Reuters report to trade up 3.2 percent at $95.55.
This story was refiled to correct typo in headline.)
(Reporting by Alastair Sharp in Toronto; Editing by Jim Finkle and Rosalba O’Brien)