It’s been a wild ride for shareholders of Fiverr International Ltd. (NYSE: FVRR) since the company’s initial public offering in June 2019. The stock has more than doubled from its $21 IPO price, but it’s also given up about half of its post-IPO gains.
Fiverr is a marketplace for freelancers, connecting them with businesses and individuals who need their services. The company offers more than 200 different services in categories like graphics and design, digital marketing, writing and translation, video and animation, and music and audio.
The company has been growing rapidly, with revenue increasing by 63% in the first quarter of 2020 compared to the same quarter last year. But Fiverr has also been investing heavily in its business, which has led to widening losses.
So what’s next for Fiverr? Can the stock continue to outperform the market? Let’s take a look at a few factors that could impact the stock in the coming months.
The COVID-19 pandemic has been a tailwind for Fiverr’s business. With more businesses and individuals working remotely, there’s been an increase in demand for the types of services offered on Fiverr. This trend is likely to continue in the near term as the pandemic continues to disrupt businesses and economies around the world.
Fiverr has also been benefiting from a shift in spending by businesses from offline to online channels. This trend was already underway before the pandemic, but the pandemic has accelerated it.
Businesses are moving their advertising budgets from traditional channels like television and print to digital channels like social media and search engine marketing. This shift is likely to continue as businesses seek to reach consumers where they are spending more of their time online.
The company is also benefiting from an increase in freelancers joining its platform. In the first quarter of 2020, Fiverr added 2 million new users, bringing its total user base to 8 million.
This growth is being driven by a number of factors, including changes in the workforce brought about by the pandemic. With more people working remotely, there’s been an increase in demand for flexible work arrangements. And with many businesses cutting costs, there’s been an increase in demand for freelancers who can provide services at lower rates than traditional agencies or contractors.
Looking ahead, Fiverr appears well-positioned to continue its growth trajectory. The company is benefiting from strong secular trends that are tailwinds for its business.
And with its shares still trading at relatively low levels compared to its peers, there could be more upside potential for investors who are willing to take on a little bit of extra risk.
It’s impossible to predict the future of a publicly traded company’s stock, so any answer to this question is speculative at best. However, it’s worth noting that Fiverr’s stock price has been volatile in recent months, so investors should proceed with caution if considering buying or selling shares.
Conclusion:
Overall, it seems that Fiverr stock still has good potential despite recent market volatility. The company is continuing to grow rapidly and benefit from strong secular trends.
