E-commerce platform Shopify (NYSE:SHOP) has been on an absolute tear since its debut in mid-2015. In its short life as a public company, the stock price has nearly quadrupled. During the same time, its revenue is up nearly five times from its initial report, and the company has more than tripled its merchant count.

Some investors have recently fled the stock as a report from a noted short-seller suggested that the data scandal taking place on social media may impact the company's ability to attract new merchants. Since Shopify is scheduled to report financial results for the first quarter on May 1, before the market opens, let's take a look at some the things investors will be watching closely.

A laptop, tablet, and smartphone all displaying the Shopify app.

Can Shopify sooth investor fears? Image source: Shopify.

More outsized growth?

To review last quarter's stunning performance, Shopify's total revenue grew to $222.8 million, up 71% year over year, while producing adjusted earnings per share of $0.15, a significant improvement from the break-even performance in the prior year quarter. Its results blew past analysts' consensus estimates, which called for revenue of $208 million and adjusted earnings of $0.05 per share. This marked the 11th consecutive quarter of year-over-year revenue growth that exceeded 70%, and investors will likely be looking for more of the same.

Shopify has said it expects revenue in a range of $198 million to $202 million, which would represent growth of between 55% and 59%. The company is also forecasting an adjusted operating loss between $6 million and $8 million, exceeding the adjusted loss of $4.3 million Shopify posted in the year-ago quarter. On a GAAP basis, the company is expecting a loss in the range of $25 million to $27 million.

Analysts are also expecting significant growth, with consensus estimates for revenue of $202.23 million, or growth of 59% and just above the company's forecast, while also expecting adjusted earnings per share of $0.05. 

One number of interest to investors will be Shopify's monthly recurring revenue (MRR), a component of the company's subscription solutions segment. Recurring revenue is widely regarded as one of the single most important metrics for any subscription-based business, as it's an indicator of stable and predictable income. In Shopify's most recent quarter, MRR grew to $29.9 million, up 62% year over year, and now represents 13% of the company's total revenue.

Big moves, up or down

It is important to remember that Shopify has a sky-high valuation. With no earnings on a GAAP basis, the price-to-earnings ratio is useless. Price-to-sales provides a good proxy, with a trailing-12-month ratio of over 17 and a forward valuation of 13 -- much higher than the range of 1 to 2 that is considered good, or less than 1, which is considered excellent. 

With that type of valuation, any real or perceived shortfall in Shopify's results could result in a quick and brutal sell-off.

The stock has already taken several significant hits at the hands of noted short-seller Andrew Left of Citron Research, with the latest report stating that Shopify will suffer as the result of recent data scandals affecting social media. Left claims the potential for regulation will make it more difficult for the company to recruit new merchants to its e-commerce platform. The stock fell more than 20% in the week following the latest missive. This type of volatility is to be expected from a young and, as yet, unprofitable company.

Shopify will have to continue its ongoing pattern of stellar growth in order to reassure investors that it's business as usual for the e-commerce platform provider.