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Shopify’s Shrinking Valuation Summons the Curse of Canadian Tech

  • The e-commerce stock has lost over 50% from its November peak
  • BlackBerry, Nortel were prior tech titans that lost dominance
Shopify’s plunge has been a major headwind for the S&P/TSX Composite Index.

Shopify’s plunge has been a major headwind for the S&P/TSX Composite Index.

Photographer: David Kawai/Bloomberg

Three times in the past 13 years, a Canadian technology firm has burst into prominence and become the country’s most valuable public company. The first two times it proved to be a curse: Nortel Networks Corp. eventually went bankrupt and BlackBerry Ltd. lost its dominance of the smartphone market.

E-commerce company Shopify Inc. may prove to have more staying power, but its more than 50% drop since Nov. 19 is testing the bulls’ resolve. The swift decline has multiple causes, including the market’s rotation away from high-priced growth stocks and a slowdown in online sales. U.S. non-store retailers had a difficult December, with sales falling 8.7%.