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Wix.com (WIX) Sees a More Significant Dip Than Broader Market: Some Facts to Know

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In the latest market close, Wix.com (WIX - Free Report) reached $160.64, with a -0.29% movement compared to the previous day. The stock fell short of the S&P 500, which registered a loss of 0.19% for the day. Elsewhere, the Dow saw an upswing of 0.09%, while the tech-heavy Nasdaq depreciated by 0.36%.

Shares of the cloud-based web development company have depreciated by 2.43% over the course of the past month, underperforming the Computer and Technology sector's loss of 0.09% and the S&P 500's gain of 2.06%.

Market participants will be closely following the financial results of Wix.com in its upcoming release. The company's earnings per share (EPS) are projected to be $1.44, reflecting a 30.91% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $443.27 million, indicating a 12.55% upward movement from the same quarter last year.

WIX's full-year Zacks Consensus Estimates are calling for earnings of $5.85 per share and revenue of $1.75 billion. These results would represent year-over-year changes of +33.26% and +12.37%, respectively.

Investors should also note any recent changes to analyst estimates for Wix.com. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Currently, Wix.com is carrying a Zacks Rank of #3 (Hold).

Looking at valuation, Wix.com is presently trading at a Forward P/E ratio of 27.55. Its industry sports an average Forward P/E of 27.08, so one might conclude that Wix.com is trading at a premium comparatively.

We can additionally observe that WIX currently boasts a PEG ratio of 1.23. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Computers - IT Services industry stood at 3.1 at the close of the market yesterday.

The Computers - IT Services industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 55, finds itself in the top 22% echelons of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WIX in the coming trading sessions, be sure to utilize Zacks.com.


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