It's Time To Buy The 'Volatile' Wix, Makor Group Analyst Says
In a report published Friday, Makor Capital analysts initiated coverage of Wix.Com Ltd (NASDAQ: WIX) with a Buy rating and a price target of $30, following a meeting with CFO Lior Shemesh.
"Wix is a super high growth company that provides a web development platform for businesses and individuals enabling them to create their own website," the analysts said.
The company IPO'd in November 2013 and its share price has been volatile since then. Recently, the shares have rallied due to the company's robust 1Q15 results and raised guidance.
While the company's revenue growth has been healthy over the past couple of years, Wix has been recording losses on account of its substantial spending on R&D and S&M. In the report Makor Capital noted, "We note that FY15 should be a turning point in which Wix moves to profitability on an adjusted EBITDA basis, as the operating leverage of its business model kicks in and as revenues outgrow spending."
This performance is better than the company's initial targets, which was to reach profitability at the end of FY16. The analysts believe that Wix offers "a strong value proposition to users" and is poised to "continue its high growth in the next few years."
Despite the recent rally, the company's shares are trading at a discount to its peer group average. The analysts believe that the company's growth potential "is being underestimated by the market."
Latest Ratings for WIX
|Oct 2016||Cantor Fitzgerald||Initiates Coverage On||Buy|
|Sep 2016||RBC Capital||Downgrades||Outperform||Sector Perform|
|Sep 2016||JP Morgan||Downgrades||Overweight||Neutral|
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