What happened

Shares of Shopify (NYSE:SHOP) were up as much as 12.5% this week along with a broad rally in tech stocks. The company got numerous upgrades from analysts before its earnings report next week. As of 12:49 p.m. EDT on Friday, the stock is up 12.4% on the week.

So what

At least three Wall Street analysts raised their price targets on Shopify stock ahead of the company's earnings report next week. This includes RBC Capital Markets, which boosted its price target from $1,700 to $1,800; Stifel, which raised its price target from $1,400 to $1,600; and Susquehanna, which raised its price target from $1,500 to $1,800.

A person putting a label on a shipping box.

Image source: Getty Images.

The analyst teams highlighted third-party data showing resiliency in e-commerce sales, even with economies reopening worldwide, which led them to raise their revenue outlook for Shopify over the next few years. For example, RBC Capital Markets estimated that merchants on Shopify rose 39% year over year in the second quarter, accelerating the 27% year-over-year growth it saw in Q1. This acceleration in growth in spite of the U.S. economy reopening was likely why investors got bullish on Shopify stock this week.

Now what

Shopify is one of the best-performing stocks of the last five years, up almost 5,000% since 2016. However, with a market cap close to $200 billion and projections for less than $10 billion in revenue three years from now, a lot of future growth is already priced into this company. This doesn't mean you should sell your shares of Shopify, but don't expect a repeat of this stellar performance over the next decade.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.