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Investing.com - Cantor Fitzgerald reduced its price target on Wix.com (NASDAQ:WIX) to $135 from $160 on Wednesday, while maintaining an Overweight rating following the company’s third-quarter earnings report. The web development platform’s stock currently trades at $101.70, down nearly 20% following the earnings release and now sits just 2% above its 52-week low of $99.31.
The web development platform reported third-quarter bookings and revenue that exceeded analyst expectations by 1%, but profit fell short as the company increased spending on compute resources and marketing for its Base44 offering. Wix.com’s third-quarter profit came in 7% below Street estimates due to these elevated expenses. Despite these challenges, InvestingPro data shows Wix remains profitable with $138.9 million in net income over the last twelve months and revenue growth of 13.22% year-over-year to $1.93 billion.
Wix.com guided for fourth-quarter revenue growth of 13-15%, representing a slight acceleration compared to the third quarter, and raised its full-year 2025 bookings forecast by 150 basis points at the midpoint. The company indicated that growth investments and compute costs for Base44 will remain elevated in the near term. Analysts are projecting EPS of $7.41 for fiscal year 2025, according to InvestingPro data, with management actively buying back shares to support shareholder value.
The company also announced a delay in the launch of its AI self-creator solution, now expected in early 2026 rather than the second half of 2025, citing an expanded scope for the offering. This development, combined with increased operating expenses, contributed to Wix.com shares dropping 20% on Tuesday. This sharp decline adds to the stock’s significant 52.6% year-to-date loss and 44% drop over the past six months.
Despite near-term margin pressure, Cantor Fitzgerald maintained its Overweight rating, noting that at 8 times fiscal year 2027 estimated free cash flow, Wix.com’s valuation remains compelling given its competitive position and growth profile in the website builder market. The stock currently trades at a P/E ratio of 36.7, which InvestingPro analysis indicates is low relative to near-term earnings growth with a PEG ratio of just 0.84. According to InvestingPro’s Fair Value assessment, Wix appears undervalued at current levels, with 12 additional ProTips available to subscribers who want deeper insights into the company’s financial health.
In other recent news, Wix.com reported strong third-quarter results, surpassing expectations in both earnings and revenue. Despite the positive financial performance, several analysts have adjusted their price targets for the company. Needham lowered its price target to $140, citing increased investments in Wix’s Base44 product, while maintaining a Buy rating. Scotiabank also reduced its target to $175, noting the costs associated with AI investments but commended the company’s core platform and Base44 product for their strong performance. Citizens adjusted its target to $185, expressing concerns about free cash flow as Wix shifts focus toward growth investments. Wells Fargo set a new target of $184, pointing to investor concerns over non-GAAP operating income and free cash flow outlook for 2026. Raymond James lowered its target to $150, despite acknowledging the company’s earnings report exceeded expectations and raised bookings forecasts. These developments reflect a mix of optimism and caution from analysts regarding Wix.com’s financial strategies and market performance.
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