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WIX Stock Soars 18.6% YTD: Will the Upward Trend Continue?
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Wix.com (WIX - Free Report) is witnessing healthy momentum this year so far. Shares of the company have gained 18.6% year to date compared with the sub-industry’s and S&P composite’s growth of 17.1% and 13.2%, respectively.
Wix currently sports a Zacks Rank #1 (Strong Buy).
Apart from a favorable rank, WIX has a Growth Score of A. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank of 1 or #2 (Buy) and a VGM Score of A or B offer solid investment opportunities.
Wix is a cloud-based web development platform which offers solutions enabling businesses, organizations, professionals and individuals to develop customized websites and application platforms.
Image Source: Zacks Investment Research
Factors Driving Price Surge
WIX is gaining from continued momentum in annualized recurring revenues from Creative subscriptions. In the last reported quarter, Creative subscriptions annualized recurring revenues were $1.16 billion, up 10% year over year.
Strong uptake of existing products as well as frequent new product launches bode well. Recently, Wix introduced Tap to Pay on Android in collaboration with Stripe, aimed at streamlining in-person transactions for merchants in the United States. Wix merchants can leverage this feature to securely accept contactless payments directly through their Android devices, eliminating the need for additional hardware. The Wix Owner App transforms compatible Android devices into point-of-sale terminals, enabling merchants to conduct in-person transactions conveniently and securely.
The company plans to tap the growing demand for artificial intelligence (AI) by launching new products like AI Site Generator and AI Assistant for businesses. These capabilities leverage the power of AI to automate various aspects of website creation process, empowering businesses to grow and operate more efficiently. In August 2023, it launched Wix Studio, which allows users to leverage latest AI technology and develop advanced websites at scale.
Increasing partner revenues and B2B partnerships are tailwinds. The conversion of new users to paid subscriptions, strong customer retention and increasing average revenue per subscription augur well. At second-quarter end, registered users were 254 million.
Owing to the above-mentioned factors, management now expects 2023 revenues to grow by 11-12% compared with the previous guidance of 10-11%.
However, volatile macroeconomic environment and foreign currency fluctuations could weigh down on the company’s performance. Stiff competition and rising accumulated deficit are major headwinds.
A Look at Estimates
WIX’s EPS estimate for 2023 is pegged at $3.35. It incurred a loss of 17 cents per share in 2022. The Zacks Consensus Estimate for 2024 earnings is pegged at $3.53 per share.
The Zacks Consensus Estimate for 2023 EPS has increased to $3.35 from $2.30 in the past 60 days, reflecting analysts’ optimism. The consensus estimate for 2024 EPS has improved to $3.53 from $2.96 over the same time frame.
The company’s revenues for 2023 are projected to rise 11.8% to $1.55 billion. For 2024, the metric is anticipated to climb 11.9% to $1.74 billion.
WIX outpaced estimates in all the trailing four quarters, delivering an earnings surprise of 319.3%, on average.
The Zacks Consensus Estimate for Asure Software’s 2023 EPS has increased 35% in the past 60 days to 54 cents.
Asure Software’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average surprise being 676.4%. Shares of ASUR have surged 65.9% in the past year.
The Zacks Consensus Estimate for Aspen Technology’s fiscal 2024 EPS has gained 6.8% in the past 60 days to $6.58. Aspen Technology’s long-term earnings growth rate is 17.1%. Shares of AZPN have declined 13.9% in the past year.
The Zacks Consensus Estimate for Badger Meter’s 2023 EPS has improved 1.4% in the past 60 days to $2.86. Badger Meter’s earnings outpaced the Zacks Consensus Estimate in all the last four quarters, the average surprise being 6.7%. Shares of BMI have jumped 68.3% in the past year.
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WIX Stock Soars 18.6% YTD: Will the Upward Trend Continue?
Wix.com (WIX - Free Report) is witnessing healthy momentum this year so far. Shares of the company have gained 18.6% year to date compared with the sub-industry’s and S&P composite’s growth of 17.1% and 13.2%, respectively.
Wix currently sports a Zacks Rank #1 (Strong Buy).
Apart from a favorable rank, WIX has a Growth Score of A. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank of 1 or #2 (Buy) and a VGM Score of A or B offer solid investment opportunities.
Wix is a cloud-based web development platform which offers solutions enabling businesses, organizations, professionals and individuals to develop customized websites and application platforms.
Image Source: Zacks Investment Research
Factors Driving Price Surge
WIX is gaining from continued momentum in annualized recurring revenues from Creative subscriptions. In the last reported quarter, Creative subscriptions annualized recurring revenues were $1.16 billion, up 10% year over year.
Strong uptake of existing products as well as frequent new product launches bode well. Recently, Wix introduced Tap to Pay on Android in collaboration with Stripe, aimed at streamlining in-person transactions for merchants in the United States. Wix merchants can leverage this feature to securely accept contactless payments directly through their Android devices, eliminating the need for additional hardware. The Wix Owner App transforms compatible Android devices into point-of-sale terminals, enabling merchants to conduct in-person transactions conveniently and securely.
The company plans to tap the growing demand for artificial intelligence (AI) by launching new products like AI Site Generator and AI Assistant for businesses. These capabilities leverage the power of AI to automate various aspects of website creation process, empowering businesses to grow and operate more efficiently. In August 2023, it launched Wix Studio, which allows users to leverage latest AI technology and develop advanced websites at scale.
Increasing partner revenues and B2B partnerships are tailwinds. The conversion of new users to paid subscriptions, strong customer retention and increasing average revenue per subscription augur well. At second-quarter end, registered users were 254 million.
Owing to the above-mentioned factors, management now expects 2023 revenues to grow by 11-12% compared with the previous guidance of 10-11%.
However, volatile macroeconomic environment and foreign currency fluctuations could weigh down on the company’s performance. Stiff competition and rising accumulated deficit are major headwinds.
A Look at Estimates
WIX’s EPS estimate for 2023 is pegged at $3.35. It incurred a loss of 17 cents per share in 2022. The Zacks Consensus Estimate for 2024 earnings is pegged at $3.53 per share.
The Zacks Consensus Estimate for 2023 EPS has increased to $3.35 from $2.30 in the past 60 days, reflecting analysts’ optimism. The consensus estimate for 2024 EPS has improved to $3.53 from $2.96 over the same time frame.
The company’s revenues for 2023 are projected to rise 11.8% to $1.55 billion. For 2024, the metric is anticipated to climb 11.9% to $1.74 billion.
WIX outpaced estimates in all the trailing four quarters, delivering an earnings surprise of 319.3%, on average.
Other Stocks to Consider
Some other top-ranked stocks in the broader technology space are Asure Software (ASUR - Free Report) , Aspen Technology (AZPN - Free Report) and Badger Meter (BMI - Free Report) . Asure Software presently sports a Zacks Rank #1, whereas Badger Meter and Aspen Technology carry a Zacks Rank #2 each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Asure Software’s 2023 EPS has increased 35% in the past 60 days to 54 cents.
Asure Software’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average surprise being 676.4%. Shares of ASUR have surged 65.9% in the past year.
The Zacks Consensus Estimate for Aspen Technology’s fiscal 2024 EPS has gained 6.8% in the past 60 days to $6.58. Aspen Technology’s long-term earnings growth rate is 17.1%. Shares of AZPN have declined 13.9% in the past year.
The Zacks Consensus Estimate for Badger Meter’s 2023 EPS has improved 1.4% in the past 60 days to $2.86. Badger Meter’s earnings outpaced the Zacks Consensus Estimate in all the last four quarters, the average surprise being 6.7%. Shares of BMI have jumped 68.3% in the past year.