Morgan Stanley lifts Wix.com stock price target to $279

On Wednesday, Morgan Stanley (NYSE:MS) showed a positive stance on Wix.com (NASDAQ:WIX), as the research firm increased the company’s price target from $276.00 to $279.00. The firm retained its Overweight rating on the stock. The adjustment follows Wix.com’s fourth-quarter results, which rounded off the year on a strong note. According to InvestingPro data, WIX has delivered an impressive 79% return over the past year, with the stock currently trading near $214. Based on comprehensive analysis, InvestingPro’s Fair Value model suggests the stock is currently overvalued.

The analyst at Morgan Stanley, Elizabeth Elliott, noted that the company’s performance in the fourth quarter was robust and that the forecast for the fiscal year 2025 indicates sustained growth. This outlook is supported by continuous product innovation and solid fundamentals, with InvestingPro data showing revenue growth of 12.6% and a healthy gross profit margin of 67.9%. Elliott highlighted that an acceleration in growth, coupled with disciplined cost management, is expected to lead to an increase in free cash flow (FCF). She believes that the projected rise in FCF for FY25 has not been fully recognized by the market.

According to Elliott, Wix.com’s shares are currently trading at a discount compared to its peers, despite the positive indicators. The Overweight rating suggests that Morgan Stanley views Wix.com as a favorable investment option, with expected performance outpacing the average of the sector over the next 12 to 18 months. This aligns with the broader analyst consensus, as InvestingPro data reveals a strong buy recommendation with price targets ranging from $166 to $300. The company maintains a "GOOD" Financial Health score, supported by 15 additional ProTips available to InvestingPro subscribers.

Wix.com’s commitment to innovation and cost efficiency appears to be the core drivers behind Morgan Stanley’s upgraded price target. The firm’s analysis indicates confidence in the company’s ability to generate increased FCF moving forward.

The revised price target of $279.00 represents Morgan Stanley’s expectation of Wix.com’s share value in the near future, based on the company’s financial health and market position. With the Overweight rating unchanged, Morgan Stanley maintains a bullish outlook on Wix.com’s stock.

In other recent news, Wix.com reported its fourth-quarter 2024 earnings, revealing an earnings per share (EPS) of $1.93, which exceeded analyst expectations of $1.59. However, the company’s revenue for the quarter was $460.5 million, slightly missing the forecast of $461.87 million. Oppenheimer has maintained its Outperform rating for Wix.com, with a price target of $250, following these earnings results. The company’s total bookings for 2024 reached $1.83 billion, marking a 15% year-over-year increase, while revenue grew by 13% to $1.76 billion.

Wix.com’s free cash flow was reported at $488 million, representing 28% of revenue, nearly doubling from the previous year. Despite a decline in premium subscribers by 72,000, the company noted a 23% increase in transactional strength and a 29% growth in the partnerships segment. Looking forward, Wix projects total bookings for 2025 to be between $2.02 billion and $2.016 billion, with anticipated revenue ranging from $1.97 billion to $2 billion. The company also expects to achieve a fiscal year 2025 free cash flow margin of 31-32%, surpassing consensus expectations.

Wix continues to focus on product innovations, with plans to launch new self-creator solutions and a transformative internet presence product in 2025. The company remains committed to leveraging AI to drive growth and enhance its product offerings.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.