Israeli website creator Wix (NASDAQ:WIX) beat earnings estimates, sending WIX stock up 20%.
Wix earned $24 million, 41 cents per share fully diluted, on revenue of almost $420 million during the quarter.
WIX stock opened today at $150 per share, a market cap of over $8 billion. That means shares are now up 27% for 2024.
Why WIX Stock Popped
WIX stock popped after the company raised its estimates for the rest of the year. It now expects revenue growth of 11-13% for 2024 and total revenues of $1.75 billion.
The improved results caught some traders offside. Wix stock was trading below $120 per share as recently as May 1.
The company’s flagship, Wix Studio, mainly sells to ad agencies and advertisers. Its partners can create their own templates for clients, and its marketplace lets clients quickly find developer partners.
Wix was founded as a simple website builder but now offers artificial intelligence (AI)- powered tools for agencies and enterprises.
The stock is popular with both analysts and traders. All but two of 18 analysts at Tipranks tell clients to buy it. Traders expected the stock to break $150/share after earnings, and they’re happy to be correct.
Wix competes with Squarespace (NASDAQ:SQSP), Shopify (NASDAQ:SHOP) and WordPress, among others. Website Builder rates it 4.9 out of 5, praising its diverse set of features and intuitive editor.
Management is confident growth will continue. It now expects $14 billion in revenue from current customers over the next 10 years. In February, it had 200 million users. Wix operates under a “freemium” business model in which simple versions of the software are offered for free. The commercial capabilities help convert free users to paid.
What Happens Next?
Beating the number always wins the love of investors and traders alike. Wix now needs to continue the momentum in the face of rising expectations.
On the date of publication, Dana Blankenhorn 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.
