Wix.com Ltd. (NASDAQ: WIX) is a publicly traded web development platform that provides software as a service for businesses to create HTML5 websites and mobile sites through the use of online drag and drop tools. The company was founded in 2006 and is headquartered in Tel Aviv, Israel.
Wix.com went public on the Nasdaq in 2013, and its stock has since tripled in value. The company reported strong fourth quarter results in February, with revenue up 47% year-over-year to $93 million and adjusted EBITDA up 67% to $32 million. Wix also announced that it now has 110 million registered users, up from 97 million a year ago.
Exciting update! We've collaborated with Wix to offer WBI users with a free plan for all website creation needs - Explore the details here.
The company’s strong results are being driven by solid growth in its core web development business as well as its newer ventures into artificial intelligence and e-commerce. Wix’s AI-powered website builder, Wix ADI, is now used by over 1 million users and its e-commerce platform has processed $1 billion in gross merchandise volume since launching in early 2016.
With shares of Wix up nearly 30% so far in 2018, investors are wondering if the stock is still a buy at current levels. Let’s take a look at three reasons why Wix could continue to outperform in the months ahead.
1.
Wix Is Benefiting From Strong secular Trends
There are several long-term secular trends working in favor of Wix, including the shift from traditional media to digital channels for advertising and marketing spend, the increasing importance of mobile commerce, and the growing trend of do-it-yourself website building.
According to research firm eMarketer, global spending on digital advertising will grow by double digits this year to reach $273 billion. This represents an increase of nearly 16% from 2017 and continues a trend of rapid growth that started more than a decade ago. Digital ad spending is now expected to account for more than 50% of all global ad spending by 2019.
Wix is benefiting from this shift as businesses increasingly turn to its platform to build their online presence. The company generates the vast majority of its revenue from premium subscriptions, which allow users to connect their domain name to their website, remove Wix ads, get additional storage and bandwidth, and access other premium features.
2. Artificial Intelligence Is Powering Wix’s Next Wave of Growth
Wix’s investments in artificial intelligence are starting to pay off with the success of its AI-powered website builder, Wix ADI.
