The market was on the move last week, and more than 560 stocks on the three major stateside exchanges hit fresh highs. Volatility is in the air, and some investments are making bigger moves than others.
It took disrupting its own flagship business to finally take out the all-time highs Disney established four summers ago. Revealing details for its Disney+ streaming service on Thursday helped propel the stock on Friday to its largest single-day gain in years.
Disney+ is a gamble. The platform isn't expected to turn a profit until fiscal 2024, and its success is going to come at the expense of the steady trickle of money it gets from cable and satellite television providers. However, the family-entertainment behemoth had to do something. Disney stock was in a lull for years as the market feared how cord-cutters would eat into its leadership in broadcasting and media networks. Come November, it will have an aggressively priced streaming hub that will be magnetic to more than just young families. Sometimes the disrupted becomes the disruptor.
Two weeks ago, Citron Research was arguing that Shopify stock was overvalued and that it should be trading for roughly half of its current price tag. If the stock was still trading above $200 in 12 months, Citron said it would donate $200,000 to the Robin Hood Foundation. With the shares moving higher for six consecutive trading days, up to nearly $215 on Friday, Citron may want to start rounding up the money for charity.
Shopify continues to grow as a way for small businesses and aspiring merchants to establish an e-commerce presence. There are now more than 800,000 digital storefronts on Shopify's platform. Growth is decelerating, but revenue still skyrocketed 54% in its latest quarter, matching the growth in sales by its satisfied merchant base. The stock isn't cheap by most measuring sticks, but vocal naysayers don't tend to nail the top when it comes to momentum stocks.
There's no shortage of companies making it easy to get a website up and running with minimal programming and Web design experience. Israel-based Wix is still standing out, and it's growing quickly in the process. Revenue has increase by more than 40% in at least each of the past eight years.
On Wednesday, Wix announced plans for new headquarters in Tel Aviv, as its current Port of Tel Aviv campus is nearing capacity. The larger facility should be ready by 2022. Wix barreled into its first year of profitability on an adjusted basis in 2018, and with operating expenses growing at a slower clip than its top line, we should see the scalability play out in the coming years.