Yahoo Finance Wix.com Ltd. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Shareholders will be ecstatic, with their stake up 26% over the past week following Wix.com Ltd.'s (NASDAQ:WIX) latest quarterly results. It looks like a credible result overall - although revenues of US$420m were what the analysts expected, Wix.com surprised by delivering a (statutory) profit of US$0.41 per share, an impressive 286% above what was forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Wix.com
After the latest results, the 18 analysts covering Wix.com are now predicting revenues of US$1.75b in 2024. If met, this would reflect a notable 9.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 42% to US$1.71. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.75b and earnings per share (EPS) of US$1.19 in 2024. Although the revenue estimates have not really changed, we can see there's been a considerable lift to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target rose 14% to US$179, suggesting that higher earnings estimates flow through to the stock's valuation as well. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Wix.com at US$210 per share, while the most bearish prices it at US$130. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Wix.com's revenue growth is expected to slow, with the forecast 12% annualised growth rate until the end of 2024 being well below the historical 18% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 9.2% per year. Even after the forecast slowdown in growth, it seems obvious that Wix.com is also expected to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Wix.com's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Wix.com. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Wix.com analysts - going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 3 warning signs we've spotted with Wix.com .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
