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Monday, Wix.com shares (NASDAQ:WIX) received a boost from Citi, as analysts at the firm raised the price target on the company’s stock to $275 from $270, while reiterating a Buy rating. The stock, which has delivered an impressive 87% return over the past year, is trading near its 52-week high of $247.11. According to InvestingPro data, 11 analysts have recently revised their earnings estimates upward for the upcoming period. Citi expects Wix to report its third consecutive quarter of acceleration in the Self Creators segment and continued momentum in the Partners segment, driven by the company’s Studio offering.
The analysts at Citi acknowledged the recent positive sentiment towards Wix but also noted concerns about the company’s fiscal year 2025 (FY25) bookings growth guidance. This apprehension stems from Wix’s FY24 pricing tailwinds, which might not be as strong in FY25, considering price increases are only planned for the first quarter of the year. With current revenue growth at 12.63% and a market capitalization of $13.37 billion, InvestingPro analysis reveals over 15 additional key insights about Wix’s financial health and growth prospects. Despite these concerns, Citi remains optimistic about Wix’s fundamentals, citing multiple meaningful product initiatives that could drive top-line growth not only in 2025 but also in subsequent years.
Citi’s analysts are particularly interested in the potential acceleration of the Self Creators segment as Wix begins to monetize its AI products and launches a new Editor platform. Additionally, for the Partners segment, the firm anticipates continued momentum with Studio, which could potentially compound among existing users and enable Wix to capture market share, particularly as conflicts arise at competing platforms like WordPress.
The report from Citi also mentioned a slight lowering of estimates for Wix, taking into account the impact of foreign exchange fluctuations and the anticipated tougher pricing comparisons. With Wix’s next earnings report scheduled for February 19, investors seeking deeper insights can access the comprehensive Pro Research Report available on InvestingPro, which covers detailed valuation metrics and growth prospects. Despite these adjustments, the overall outlook for Wix remains positive, with Citi emphasizing the strength of the company’s underlying business and its capacity to maintain pricing power moving forward.
In other recent news, Wix.com has completed its $200 million share buyback program, repurchasing approximately 868,026 outstanding ordinary shares. This initiative is part of Wix’s broader strategy to manage its capital structure and return value to its shareholders. In recent developments, Wix.com has been the subject of several analyst upgrades and positive revisions in price targets. Morgan Stanley (NYSE:MS) upgraded Wix.com’s stock from Equalweight to Overweight, citing growth in the Self-Creators segment and advancements in artificial intelligence. Benchmark noted sustainable free cash flow growth for Wix, while Piper Sandler raised the Wix.com target to $249 based on strong growth. Needham increased its target for Wix.com due to a positive growth outlook.
Wix.com’s third-quarter performance reported an adjusted earnings per share of $1.50 and revenue of $444.7 million, a 13% year-over-year increase. This performance was largely driven by a 16% surge in bookings growth, attributed to the company’s Studio product, AI innovations, and robust commerce activity. Wix.com’s management team has raised its full-year 2024 revenue guidance to a range of $1.757-$1.764 billion, up from the earlier forecast of $1.747-$1.761 billion.
The introduction of new AI-related products across its subscription services in 2025 is expected to enhance Wix.com’s offerings and potentially boost its financial performance. The firm’s analysts anticipate a positive financial trajectory for Wix.com, with expectations of sustained growth and improved free cash flow.
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