Shopify Inc. shares moved sharply lower after Citron Research – a publisher operated by the activist short seller Andrew Left – issued a bearish report on the stock. In the report, Mr. Left highlights the company’s affiliate partner program that promotes members becoming “millionaires.” He believes that these promotions are more brazen than the program of Herbalife Ltd. which eventually drew the attention of the Federal Trade Commission.
Baird analysts stepped in to defend Shopify stock following the report, saying that the comparison to Herbalife is not accurate. Baird said that a review of Shopify ads does not show many references to “becoming a millionaire” as Citron Research alleges. Many investors have also pointed out that Shopify operates an e-commerce platform for businesses and does not sell to consumers, which makes Herbalife an unfair comparison. (See also: Herbalife Sinks as FTC Regulation Stands to Thwart Growth.)
Shopify shares fell sharply lower after Citron issued a bearish report, but traders will be watching these key support levels. …read more
Read more here: Shopify Stock Falls to Critical Support Level
Category: SHOP, HLF