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On Wednesday, Raymond (NSE:RYMD) James analyst Josh Beck reiterated a Strong Buy rating on Wix.com (NASDAQ:WIX) shares, maintaining a $300.00 price target. The $12 billion market cap company, which has delivered an impressive 79% return over the past year, received praise for its quality bookings beat, driven by the momentum of Wix Studio and potential future benefits from improved AI Website Builder conversions and new product launches. According to InvestingPro, the company maintains a GOOD overall financial health score, with particularly strong growth metrics.
Beck’s analysis pointed out that while the foreign exchange neutral (FXN) bookings outlook for the year was in line with expectations, the actual figures suggest a more second-half weighted performance, with first-quarter 2025 revenue growth at 12.2%. This aligns with the company’s current revenue growth rate of 12.63% and robust gross profit margin of 67.88%. Despite the bookings growth being closer to expectations and the 2025 bookings trajectory falling below buyside expectations, Beck sees opportunities for growth acceleration.
The analyst noted that the annual recurring revenue (ARR) from Wix Studio is expected to ramp up significantly, from approximately $70 million in the fourth quarter of 2024 to $175 million in the same period of 2025. This increase could provide a substantial tailwind to future bookings growth. Additionally, the AI Website Builder is anticipated to contribute positively to premium subscription growth through improved user conversion rates.
In terms of financials, Wix.com’s free cash flow (FCF) exceeded expectations and the guidance for 2025 was ahead of consensus estimates. While Raymond James has adjusted its 2025 revenue forecast downward due to foreign exchange impacts, the 2026 outlook is more optimistic, factoring in an improved bookings outlook and diminishing FX headwinds. The firm also increased its FCF estimates for 2025 and 2026.
Beck concluded by emphasizing the structural tailwind expected from a notable rise in the contribution from Partners and Studio during 2024 and 2025, suggesting a robust structural support for the company’s growth. For deeper insights into Wix.com’s valuation and growth prospects, InvestingPro subscribers can access 15+ additional ProTips and a comprehensive Pro Research Report, which provides detailed analysis of the company’s financial health, valuation metrics, and growth potential.
In other recent news, Wix.com reported its fourth-quarter 2024 earnings, surpassing analyst expectations with an earnings per share (EPS) of $1.93, compared to the forecasted $1.59. Despite this earnings beat, revenue for the quarter was slightly below expectations at $460.5 million, missing the forecast of $461.87 million. Oppenheimer maintained its Outperform rating and $250 price target for Wix.com shares, noting that the company’s bookings, revenue, and free cash flow were in line with consensus estimates. Morgan Stanley (NYSE:MS) also showed confidence in Wix.com by raising its price target from $276 to $279 and retaining an Overweight rating, indicating a positive outlook for the company’s future performance. Analysts from Morgan Stanley highlighted Wix.com’s robust fourth-quarter performance and projected growth for fiscal year 2025, driven by product innovation and cost management. Wix.com has provided guidance for 2025, anticipating mid-teens revenue growth and low-teens bookings growth, with a free cash flow margin forecast of 31-32%, excluding foreign exchange impacts. The company continues to focus on AI initiatives and product innovations, which are expected to drive future growth. These developments reflect Wix.com’s strategic direction and potential for sustained growth.
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