Weekly Stock Analysis: WIX ($WIX)
This week’s stock analysis focuses on Wix.com Ltd., an Israeli cloud-based web development platform that has been making waves in the market. Founded in 2006 by Avishai Abrahami, Nadav Abrahami, and Giora Kaplan, Wix went public on the Nasdaq in 2013. The company allows users to create HTML5 websites and mobile sites using online drag-and-drop tools.
Revenue Projections and Business Model
Wix’s revenue projections for 2022 are a staggering $1.92 billion. The company operates as a freemium web development platform, meaning that users can create a website for free but must pay for premium services such as removing Wix branding from their site, using a custom domain name, or accessing advanced features like e-commerce functions. Wix makes money through two main channels: advertisements and subscriptions.
Competition and Market Analysis
Wix competes with other prominent players in the market, including Weebly, Squarespace, and Jimdo. These companies all follow a similar business model to Wix, offering users a basic level of service for free but charging for premium features. While Wix is currently the largest player in the market, the competition is fierce, and Wix must continue to innovate to maintain its position.
Best Case – Worst Case Analysis
To better understand the risks and rewards associated with holding Wix stock, we will examine the company’s past performance using a Best Case – Worst Case Analysis. This exercise involves measuring the distance between the high price and low price if a higher high is not made for the worst-case scenario and the distance between a low price and high price if a lower low is not made for the best-case scenario.
Vantagepoint A.I. Forecast
The VantagePoint software provides an advanced A.I.-based forecast, which includes predictive analytics and neural network-based forecasting. The A.I. forecast suggests that Wix’s stock price will continue to rise in the near future, but traders should exercise caution due to the company’s volatility.
Daily Price Range Prediction
One of the powerful features in the VantagePoint Software is the Daily Price Range prediction forecast. This forecast helps traders fine-tune their entries and exits into the market by predicting the daily price range of Wix’s stock.
Intermarket Analysis
The Vantagepoint A.I. Intermarket analysis reveals that small changes in interest rates, crude oil prices, and volatility can significantly affect the decisions companies make to survive in challenging times. By understanding these correlations, traders can better identify opportunities and make more informed trading decisions.
Suggestion for Traders
From a fundamental point of view, Wix’s revenue stream is dependent on subscription income and advertising. However, the company has reported negative earnings every quarter last year, and this trend may continue in the current year. This validates the volatility of WIX and confirms the short-term bias that traders must have to be successful in trading this asset.
Trading Recommendation
We recommend that seasoned traders place Wix on their trading radar, but exercise caution due to its high volatility. It’s essential for traders to use conservative money management with small allocations to this asset, as the trend can turn quickly.
Let’s re-evaluate this analysis based upon Wall Street Analysts’ Estimates, 52-week high and low boundaries, Vantagepoint A.I. Forecast (Predictive Blue Line), Neural Network Forecast, Daily Range Forecast, and Intermarket Analysis in future updates.
Disclaimer
Trading involves a high degree of risk, and it’s not prudent or advisable to make trading decisions that are beyond your financial means or involve trading capital that you’re not willing and capable of losing.