In the wake of the Covid-19 pandemic, companies are sourcing talent in many ways. Fiverr (NYSE:FVRR) is benefiting from the freelancer revolution in the 2020’s, and this was reflected in last year’s performance of FVRR stock.
However, that bull run seems to be taking a breather. This shouldn’t be a problem, though, for patient investors who can envision the big picture.
In that picture, Fiverr continues to play an essential role in the new economy, which is increasingly becoming a gig-based economy.
Informed investors should prepare for this change in how the world works — and check Fiverr’s revenues as the company is undeniably in growth mode.
FVRR Stock at a Glance
It’s worth noting that the onset of Covid-19 in early 2020 did make a dent in FVRR stock, but not for very long.
The share price bottomed out at around $21, and then it was off to the races. Over the ensuing 11 months, the stock doubled, and then doubled again a couple more times.
FVRR stock didn’t finally top out until Feb. 16, 2021, when it reached the jaw-dropping price of $336. Hence, it’s understandable that the bulls had to take a break for a while.
After it peaked, the stock chopped around and settled into the $225 area in mid-July. This should be viewed as a normal and healthy part of the process, especially after such a powerful rally.
Notably, FVRR stock has a five-year monthly beta of 2, meaning that it has historically tended to move twice as fast as the S&P 500.
Therefore, even if you’re long-term bullish, you don’t need to over-leverage yourself on Fiverr shares. As always, moderation is the key to success.
A Market in the Billions
To put it simply, the Fiverr platform allows businesses and individuals to hire freelancers for gigs, which are usually low-priced (though not necessarily $5, even if the company’s name implies this).
Of course, Fiverr gets a cut of the action whenever it pairs up employers and workers. But is this a lucrative business model?
The answer is definitely yes. For one thing, Fiverr cites that the addressable market is $115 billion — and the estimated U.S. total freelancer income exceeds $815 billion.
And here’s where it gets really interesting: Fiverr asserts that the majority of freelancing still happens offline. Moreover, “Just like e-commerce in 1994, freelancing activity is gradually migrating to the online world.”
In other words, even in 2021, Fiverr is still a ground-floor opportunity. Within the redefined workplace, Fiverr remains an early and ambitious service-as-a-product (SaaP) provider.
And if you’re looking for hard data, Fiverr’s got you covered. For the first quarter of 2021, the company literally doubled its revenues on a year-over-year basis, raking in $68.3 million.
Tapping Into Freelance Talent
With its mission to change how the world works, Fiverr has had to adapt to changes brought on by Covid-19. The good news, however, is that these changes actually favor Fiverr’s business model, rather than hinder it.
Based on data gathered by Censuswide and presented by Fiverr, it’s evident that large businesses are relying on freelance talent more nowadays than they did prior to the Covid-19 pandemic.
According to Fiverr, 45% of surveyed businesses are using more freelancers than they did in pre-Covid times.
Furthermore, the bigger the business, the more likely it is to tap into freelance talent:
- 10 to 49 employees: 48%
- 50 to 99 employees: 62%
- 100 to 249 employees: 64%
This result makes sense, since larger businesses (with 100 to 249 employees) are, per the survey, focusing their investments in areas such as digital marketing (47%), website development (45%) and mobile app development (41%).
These are areas in which many of the tasks can be done by freelance workers. And Fiverr is more than happy to provide those workers – and profit from the transactions.
Today’s investors, just like today’s businesses, can’t be stuck in the old economy. Gig workers, sourced through online platforms, are becoming essential and even indispensable in the 2020’s.
Fiverr’s platform is tailor made for the new, post-Covid-19 economy.
The company was early in this space, and like the modern workplace, is evolving and benefiting its many stakeholders.
On the date of publication, Louis Navellier had a long position in FVRR. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article. The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Louis Navellier, who has been called “one of the most important money managers of our time,” has broken the silence in this shocking “tell all” video… exposing one of the most shocking events in our country’s history… and the one move every American needs to make today.