Here's How Much You'd Have If You Invested $1000 in Wix.com a Decade Ago (Revised)
For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Wix.com (WIX) ten years ago? It may not have been easy to hold on to WIX for all that time, but if you did, how much would your investment be worth today?
Wix.com's Business In-Depth
With that in mind, let's take a look at Wix.com's main business drivers.
Headquartered in Tel Aviv, Israel and founded in 2006, Wix.com Ltd. is a cloud-based web development platform. The company's platform offers solutions that enable businesses, organizations, professionals and individuals to develop customized websites and application platforms and grow their online presence.
In 2022, the company reported revenues of $1.39 billion, up 9% year over year. Growth in the number of registered users and premium subscriptions are key revenue drivers. The company’s products and services include Wix Editor, Velo by Wix, Wix Logo Maker, Wix Studio and Wix Stores.
Wix Editor offers ready templates and drag-and-drop editor tool to facilitate Website editing to make web stores look professional without any design experience.
Velo by Wix is an open development platform for creating innovative web applications.
Wix Studio allows users to leverage latest AI technology and develop advanced websites at scale. Moreover, with Wix Logo Maker users can generate a logo by utilizing AI technology.
Wix Stores is the company’s e-commerce platform that offers merchants professional tools and services to create, design, manage and expand their e-commerce business.
Registered users as of Sep 30, 2023, were 258 million.
For increased transparency, beginning the fourth quarter of 2019, Wix reported revenues, collections and cost of revenues under two segments: Creative Subscriptions and Business Solutions. Creative Subscriptions and Business Solutions contributed 73.8% and 26.2%, respectively, to total third-quarter 2023 revenues of $393.8 million.
The company also started providing Annualized Recurring Revenue (ARR) as the primary KPI for growth of its Creative Subscriptions segment. As of Sep 30, 2023, Creative Subscriptions ARR was $1.18 billion.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Wix.com, if you bought shares a decade ago, you're likely feeling really good about your investment today.
A $1000 investment made in December 2013 would be worth $4,420.92, or a gain of 342.09%, as of December 20, 2023, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 163.50% and the price of gold went up 64.72% over the same time frame.
Looking ahead, analysts are expecting more upside for WIX.
Wix’s performance is benefiting from solid momentum in Creative Subscriptions’ and Business Solutions’ segments. The company plans to tap the growing demand for Artificial Intelligence (AI) by launching new products like Conversational AI Chat for businesses and AI Meta Tags Creator. Increasing partner revenues and B2B partnerships bode well in the long run. The conversion of new users to paid subscriptions, increasing monetization and strong customer retention is driving average revenue per subscriptions. Going ahead, the company expects 2023 revenues and free cash flow margin to rise owing to business momentum. However, volatile macroeconomic environment and unfavorable foreign currency fluctuations could weigh down on the company’s performance. Stiff competition and rising accumulated deficit are major headwinds.
The stock is up 22.88% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 6 higher, for fiscal 2023. The consensus estimate has moved up as well.
(We are reissuing this article to correct a mistake. The original article, issued on December 20, 2023, should no longer be relied upon.)
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